Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

EYEMOUTH HARBOUR ORDER CONFIRMATION

Bill to confirm a Provisional Order under the Private Legislation Procedure (Scotland) Act, 1936, relating to Eye-mouth Harbour, presented by Mr. Maclay; and ordered (under Section 7 of the Act) to be considered upon Monday next and to be printed. [Bill 147.]

Oral Answers to Questions — NATIONAL FINANCE

Animal Health Regulations (Charollais Bull Semen)

Sir J. Duncan: asked the Chancellor of the Exchequer what action he proposes to take against Craig Wheaton-Smith for smuggling Charollais bull semen into this country contrary to the Customs and Animal Health Regulations and causing to be shown at the Bath and West Show a product of this semen; and what steps he proposes to take to stop this sort of smuggling in the future which may be dangerous to the health of farm animals in this country.

The Chancellor of the Exchequer (Mr. Selwyn Lloyd): Inquiries into the circumstances of the alleged offence are not complete and I cannot anticipate their outcome.

Sir J. Duncan: Will my right hon. and learned Friend bear in mind that this man might have cost him a million pounds in compensation to farmers for foot-and-mouth disease if the semen had contained the germ? In the circumstances, will he give an assurance that when his inquiries are complete this American millionaire smuggler will not

be allowed to enter this country without being arrested and charged with his crime?

Mr. Lloyd: I fully agree with my hon. Friend about the possible serious consequences of an action like this. I think, however, that I had better not comment on what might or might not happen until the inquiries are complete.

Bona Vacantia

Mr. Hale: asked the Chancellor of the Exchequer what amounts were transferred to the Exchequer as bona vacantia in the last twelve months to the most recent convenient date, and in each of the two preceding years; and what percentage such figures represented of the total estates annually involved.

Mr. Selwyn Lloyd: In 1958, 1959 and 1960 the net value of bona vacantia after meeting all legal claims and ex gratia payments was £289,000, £414,000 and £326,000 respectively. In most cases no applications for ex gratia payments were made. For the minority of estates in which they were, the proportions retained for the Exchequer lay between 56 and 59 per cent. For the whole range of cases the percentage varied between 81 and 86 per cent.

Mr. Hale: I am much obliged to the right hon. and learned Gentleman, but is not this really getting a very serious grievance? Many of us have cases of this kind where close friends who maintained the deceased for a very long time make applications which have very unsatisfactory results. Will the right hon. and learned Gentleman really look at the question and see whether it is not proper and fit to have a general rule that, on the whole, the estate shall go to those most closely connected, either by blood or by friendship, rather than be forfeited to the Exchequer?

Mr. Lloyd: That, I think, really arises on the hon. Gentleman's next Question.

Mr. Hale: asked the Chancellor of the Exchequer whether he will introduce a procedure for further appeal by friends or relatives who have claimed to participate in bona vacantia.

Mr. Selwyn Lloyd: No, Sir. While applicants are sometimes naturally disappointed, I am satisfied that their


requests are carefully and sympathetically considered under the existing practice and arrangements; and I would add that if the hon. Member will send me particulars of any individual case, I will certainly see that they are sympathetically considered.

Mr. Hale: I am grateful for that Answer, but the point which I am trying to make, if the right hon. and learned Gentleman will consider it, is that at the moment, as far as I am aware, only written representations are possible in the normal cases. In Oldham they are made to the Chancellor of the Duchy of Lancaster and outside Lancashire to the Treasury Solicitor. People are in a difficulty if in matters of great importance to them the only thing they can do is to write a letter and await results.

Mr. Lloyd: I should make it clear that my Answer does not include the Duchy of Lancaster. Claims there are dealt with differently. I will look into the point raised by the hon. Gentleman and see that my right hon. Friend the Chancellor of the Duchy of Lancaster is made aware of it.

National Theatre

Mrs. White: asked the Chancellor of the Exchequer if he will make a further statement on the future of the National Theatre.

Mr. Selwyn Lloyd: As I told the London County Council deputation which came to see me on 6th June, their offer to meet the capital cost of erecting a National Theatre on the South Bank in excess of £1 million already approved by Parliament in the National Theatre Act, 1949, creates a new situation.
I must, however, make it clear that I would not in any event be prepared to agree to more than the sum of £1 million already approved by Parliament toward capital costs, nor could I agree to increase the sum by way of annual subvention already contemplated in accordance with my statement of 21st March.

Mrs. White: Is the right hon. and learned Gentleman aware that we are much gratified that, by implication, he is prepared to meet the guarantee already given by Parliament? Will he do all he can to see that those concerned with this matter concert their plans and their

actions so that we can make this dream into a reality?

Mr. Lloyd: I think that it is now for those concerned to consider what, I have agreed, is a new situation, and no doubt I shall be communicating to the House the result of any discussions which take place.

War Loan

Mr. C. Hughes: asked the Chancellor of the Exchequer what steps he is taking to investigate the hardship caused to persons who have invested in War Loans.

Mr. Selwyn Lloyd: I would refer the hon. Member to the Answers which my hon. Friend the Economic Secretary gave to the hon. Member for Leicester, North-West (Sir B. Tanner) on 27th June.

Mr. Hughes: Would not the Chancellor agree that a very large number of people in this country have invested their entire savings in War Loan for patriotic reasons, and has he no morsel of hope or comfort to give them? Are not the Government going to do anything to mitigate the losses which they have sustained?

Mr. Lloyd: I am acutely aware of the harship which has occurred in many cases, but I think that it would be wrong of me to raise any false hopes. The best way to help is to maintain the value of sterling abroad and try to change the present balance of payments position. I think that that is the way in which we shall help these people best.

Mr. John Hall: Will not my right hon. and learned Friend look at this matter again? Is not he aware that many people responded to the appeal to their patriotism to invest in War Loan? Is it really fair that they should be penalised, as compared with those who resisted this appeal? Will not he consider dating this stock, if he does nothing else?

Mr. Lloyd: A number of very wide aspects of public policy would be involved in such a step.

Mr. Jay: Ts the Chancellor aware that, quite apart from patriotic appeals in the past, the Financial Secretary, speaking in this year's Budget debate, said that giltedlged investors could look forward with


more confidence? As prices have fallen by another four points since then, cannot he offer a little more sympathy to the people concerned?

Mr. Lloyd: I have said that I am aware of the hardship involved in many cases. I have every confidence that what my hon. Friend said will be justified in time.

Industry, Rural Wales (Development Assistance)

Mr. Watkins: asked the Chancellor of the Exchequer how many applications were received in the latest convenient period for assistance from the Development Commission for the extension of industrial activities in each of the rural counties of Wales; how many were granted; how many were not taken up; and what was the amount in each case.

Mr. Selwyn Lloyd: Five applications for assistance were received in the year ending 30th June, 1961: two for Radnor and one each for Anglesey, Brecon and Cardigan. Four were approved and one, received last week, is under consideration. One, which had been approved, has not been taken up.
It is not possible to state the amounts of money which will be sanctioned because tenders have not yet been submitted.

Mr. Watkins: Will the Chancellor ask his Department to consider again whether publicity ought to be given about the funds available from the Development Commission so that industrialists may know about this? I understand that this is known to industrialists in Ireland through the Chancellor's colleague in the Board of Trade, but not in Wales through the Development Commission.

Mr. Lloyd: I am in complete sympathy with what the hon. Member has said. He is a member of the Mid-Wales Industrial Development Association, which is taking active steps in the matter. I will certainly ask my right hon. Friend the President of the Board of Trade to see that his officials co-operate to the utmost of their capacity. I understand that they are doing so, but I will certainly raise the matter again.

National Gallery (Giorgione Picture)

Mr. McLaren: asked the Chancellor of the Exchequer what price was paid by the Trustees of the National Gallery for the picture Sunset Landscape with St. George and St. Anthony attributed to Giorgione.

Mr. Selwyn Lloyd: This is a matter for the Trustees, and it is their considered policy not to publish the prices which they pay for pictures.

Mr. McLaren: Are not the Trustees dealing with public money? If we knew the figure, should not we be better able to judge whether they had made a good or a bad bargain?

Mr. Lloyd: I do not think that it would be very wise for figures with regard to private sales to be made public. We might find that, as a result, more public money was being spent rather than less.

University Places

Mr. Sydney Irving: asked the Chancellor of the Exchequer if he will publish his estimates of the places expected to be available at each university in each of the next five years; which of these places will be for arts studies; and which will be for science studies.

Mr. Selwyn Lloyd: I cannot give figures of the growth of university population over the next five years until the development plans for the universities which the University Grants Committee is now collecting for the quinquennium 1962–67 have been received. The distribution of students between faculties is a matter for the universities themselves. Overall, however, I would expect about two-thirds of the new places would be for science and technology.

Mr. Irving: In view of the desperate need for scientists and engineers, will the Chancellor say how that estimate compares with the present ratio between science and arts courses, and also whether he is satisfied with the two-thirds proportion, and that the estimates that he is anticipating from the University Grants Committee will come forward early enough not to make it very much more difficult for us in future than it is now?

Mr. Lloyd: With regard to the first part of the hon. Member's supplementary question, I could not do that without notice. Broadly speaking, I am satisfied with the proposed balance. I think that the University Grants Committee will report in time.

Mr. Chetwynd: Is the right hon. and learned Gentleman able to give the figures of men and women concerned, in view of the great difficulty which women are having in getting university places?

Mr. Lloyd: I should require notice of that question, but I will let the hon. Member have the information if he requires it.

Sterling

Mr. Rankin: asked the Chancellor of the Exchequer what assurances he gave to the European central banks and the American Federal Revenue Bank at their meeting in Basle at the beginning of June about reducing Government expenditure in return for sufficient funds to maintain the strength of sterling.

Mr. Selwyn Lloyd: No such assurances were given.

Mr. Rankin: In spite of the very serious nature of the speech which the right hon. and learned Gentleman made to the chambers of commerce, and the warnings he gave about the grave state of our invisible earnings and visible earnings, is he assuring us that he can maintain the strength of sterling without any propping up from abroad?

Mr. Lloyd: I think that we can maintain the strength of sterling by the general efforts of the community as a whole.

Mr. H. Wilson: Is the Chancellor suggesting that sterling is not being very much propped up from abroad at present by the holding of sterling by the European central banks? Although we all welcome this, is it not a fact that the present monthly gold figures are entirely unreal as long as an unknown amount is being held for the support of sterling?

Mr. Lloyd: I admit that they are not as precise as before, but what is happening is that some hot money which has been held on private account is now having substituted for it funds held by the central banks.

Goya Picture (Duke of Wellington)

Mr. K. Robinson: asked the Chancellor of the Exchequer if the Reviewing Committee on the Export of Works of Art has now informed him of its decision on the application to export Goya's portrait of the Duke of Wellington.

Mr. Lipton: asked the Chancellor of the Exchequer whether he has received a report from the Reviewing Committee on the Export of Works of Art in connection with Goya's portrait of the Duke of Wellington.

Mr. Selwyn Lloyd: Hon. Members will have seen in the Press the announcement that Mr. Wrightsman has offered this portrait to the National Gallery at the price which he paid for it. The National Gallery Trustees are at present considering this offer. The Reviewing Committee on the Export of Works of Art has therefore not yet advised on the case.

Mr. Robinson: Does not the Chancellor agree that this picture combines outstanding artistic merit with uniquely historic importance for this country? I do not expect him to give any specific undertaking in the matter, but does not he agree that it would be most unfortunate if this opportunity to acquire the picture for the nation was lost?

Mr. Lloyd: I agree about the merits of the picture. This is an admirable case in which private individuals could show their concern for the retention of works of art in this country by finding the money to pay for it.

Mr. Biggs-Davison: I am as anxious as any other hon. Member to keep this work of art within Her Majesty's Dominions, but does my right hon. Friend's jurisdiction extend to Jersey, whence this portrait came?

Mr. Lloyd: I do not think that it is a question of my jurisdiction, but it certainly comes within the sphere of authority of my right hon. Friend the President of the Board of Trade.

Stationery Office Publications (Technical and Training College Libraries)

Mr. Sydney Irving: asked the Chancellor of the Exchequer if he will extend the concession at present available to


public libraries and university libraries, of being able to buy the publications of Her Majesty's Stationery Office at a discount of 50 per cent., to the libraries of technical colleges and teacher training colleges.

Mr. Selwyn Lloyd: No, Sir. Technical and training college libraries are already receiving substantial assistance from the Exchequer through the ordinary grant system. The concession to university libraries is being brought to an end, and the University Grants Committee has so informed the university authorities. There is therefore no case by analogy for extending the concession to technical college libraries.

Building Controls

Mr. Rankin: asked the Chancellor of the Exchequer, in view of his decision to restrict expenditure in this country, what proposals he has for taking powers to control the building industry.

Mr. Jay: asked the Chancellor of the Exchequer whether, in view of the continued deficit in the United Kingdom balance of payments and stagnation in industrial output, he will reintroduce building and other controls.

Mr. Stratton Mills: asked the Chancellor of the Exchequer whether he will give an assurance that, in his consideration of methods of reducing expenditure, he will not take any steps to reintroduce building controls.

Mr. Selwyn Lloyd: It is not the present intention of the Government to reintroduce building controls.

Mr. Rankin: Is it not the case that on 22nd June the right hon. and learned Gentleman said that public expenditure was rising too fast, and that some necessary programmes would have to be cut? Would it be fair to do so while still leaving untouched what could, in the circumstances, be called frivolous expenditure on building?

Mr. Lloyd: It is not so much a question of cutting programmes; it is a question of restraining the increase in expenditure upon them. The question of the merits of building controls has frequently been debated. The point is whether the reinstitution of a very cumbersome machine, involving of itself a

very considerable demand on manpower, is the right way to tackle the problem.

Mr. Jay: Is it not obvious that if the Government still had these powers in their hands they would be far better able to deal with the present crisis? In particular, is not the absence of control over office building in our great cities distorting a great deal of our employment policy all over the country and leaving all sorts of insoluble problems?

Mr. Lloyd: It is a question of pros and cons, and on the whole the cons outweigh the pros in regard to building licences.

Mr. Stratton Mills: May I assure my right hon. and learned Friend that his efforts—[HON. MEMBERS: "Question."] —will my right hon. and learned Friend take note that his efforts to resist these socialistic, bureaucratic controls will be widely welcomed throughout the land?

Mr. H. Wilson: We shall want a debate on this subject before long, but will the Chancellor at any rate give an assurance that on this occasion the Government will not impose swingeing cuts on essential building within the public sector, especially on local authority building, while leaving uncontrolled relatively frivolous building in the private sector?

Mr. Lloyd: The right hon. Gentleman is quite right in saying that these matters are much better debated than dealt with by way of Question and Answer.

Mr. Tiley: Would it not be a sufficient restraint if my right hon. Friend began to tax the profits which are being made free in this area?

Mr. Lloyd: That is quite a different question from the Question on the Order Paper.

Income Tax Law

Mr. H. Wilson: asked the Chancellor of the Exchequer if he has noted the statement of the Master of the Rolls in a recent case concerning the operation of Schedule D and Schedule E expenses; and what action he proposes to take to deal with the problem.

Mr. More: asked the Chancellor of the Exchequer if his attention has been drawn to the recent statement by the


Master of the Rolls in the Court of Appeal to the effect that the Income Tax law, as now enacted, is such as to bring the law into disrepute with consequent detriment to the welfare of society; and what measures he proposes to remedy this situation.

Mr. Lipton: asked the Chancellor of the Exchequer if he will amend the Income Tax law following the comments of the Master of the Rolls in the Court of Appeal on 26th June last.

Mr. Selwyn Lloyd: I will bear the comments in mind when I am considering any relevant change in the Income Tax law.

Mr. Wilson: Is the Chancellor aware that the learned judge referred to Income Tax as
a sort of game, a battle of ingenuity unrelated to any principle or commonsense or ethical consideration, … extremely bad for respect for the law
and
seriously damaging to its prestige and consequently to the welfare of society"?
Is he aware that on many occasions we on this side of the House, and some of his hon. Friends, have pressed on him the entirely anomalous situation arising from Schedule D and Schedule E expenses but that he has failed to legislate about this? Will he take early action to get rid of this discrimination which the learned judge said was degrading for this country?

Mr. Lloyd: I will certainly consider the matter. I agree with the hon. Member that it is desirable that the tax system should be as simple as possible. What the learned judge said is one reason for not embarking on new experiments in taxation, for example, with regard to capital gains.

Mr. More: Does the Chancellor recollect that as long ago as 1936 these anomalies were adversely commented on by the Macmillan Committee appointed by his predecessor, my right hon. Friend the Member for Woodford (Sir W. Churchill)? Does he recollect that the Committee produced a draft of a new Income Tax Statute in comprehensive and lucid terms? Does he not think that the time has come when that might be enacted in place of the present chaotic jumble of archaic enactments, amending

laws, judicial decisions and Departmental practices through which the taxpayer has to grope his way?

Mr. Lloyd: If my hon. Friend is good enough to read what I said in my Budget speech, he will see that I have considerable sympathy with his point of view but, as I said then, since reaching the Treasury I have become aware that simplification is not quite as simple as it sounds.

Mr. Wilson: Is the Chancellor aware that counsel for the Inland Revenue, the hon. and learned Member for Darwen (Mr. Fletcher-Cooke), who since this case has become a junior Minister, said that had the present case come under Schedule D the result might have been different, and indeed it would have been different? Is he aware that the learned judge, having made these statements, asked counsel to bring this to the attention of the Inland Revenue and that counsel replied in terms which suggested that the Inland Revenue was well aware of the indefensible position? Will the Chancellor take action about it?

Mr. Lloyd: I am glad that the right hon. Gentleman asked that question. What learned counsel said was misreported. He did not say what he was reported as having said.

New Schools (Cost)

Mrs. Slater: asked the Chancellor of the Exchequer what would be the total cost to a local education committee of a school, for which the tender price is £170,000, after interest has been paid for 60 years at 6¼ per cent.

Mr. Selwyn Lloyd: Local authorities customarily borrow over 35 years for school building projects, not 60 as the hon. Member suggests. The repayments of capital and interest on a loan of £170,000 for 35 years at the current Public Works Loan Board interest rate of 6¼ per cent. would amount to £421,000.

Mrs. Slater: Does not the Chancellor think that, instead of talking about cutting local authority projects, such as schools, it would be much better in the interests of education and other social services if the interest rates were cut to a more reasonable level which would not put such a heavy burden on local authorities


and the individuals who have to find the money?

Mr. Lloyd: No. That would be quite the wrong aproach to the matter. If there is a shortage of capital the greatest possible mistake is to have artificially low rates of interest. If we are to correct the position, then I think that local authorities must pay the market rate—otherwise the position will never be corrected. Of course, one would rather that schools were built out of the savings of local authorities. They would then not have to pay interest rates. But I fully realise that that is not possible. That not being possible, I think that interest should be paid at the current market rate.

Mr. H. Wilson: Is the Chancellor so myopic that the cannot see the connection between his last Answer and the earlier Answer to the Questions about building controls? Is he not aware that the shortage of capital is largely due to the fact that so much unnecessary and frivolous building is being allowed to go on without any restriction while restrictions are having to be applied by interest rates and in other ways to essential school building?

Mr. Lloyd: I do not accept that there is a large amount of unnecessary and frivolous building going on. The idea that office building provides nothing to the nation is quite wrong. There is basically a shortage of capital and I think that to fiddle about with interest rates is the wrong way to deal with the problem.

Kuwait Oil Supplies

Mr. Nabarro: asked the Chancellor of the Exchequer what contribution is made to the United Kingdom balance of payments by Kuwait oil supplies; and to what extent British Petroleum, in which Her Majesty's Government is a majority shareholder, has an interest in these supplies.

Mr. Selwyn Lloyd: It is not possible to distinguish the contribution to the balance of payments arising from the oil supplies from any particular country. The British Petroleum Company has an equal share with the Gulf Oil Corporation of America in the Kuwait Oil Company, which in the year ended 31st

December, 1960, was responsible for the production of about 80 million tons of crude oil, representing the total output from Kuwait.

Mr. Nabarro: Will the Chancellor confirm that the Ruler of Kuwait has invested in British banks in London about £300 million which is his reserve from oil revenues during the last few years? As that large sum of money is evidently readily convertible and could have a dynamic effect on our balance of payments, will the Chancellor make some comment on what is obviously a very vulnerable financial position?

Mr. Lloyd: No. I do not think that I should make any comment at all. Nor do I think that I ought without notice to deal with the revenue or funds of the Ruler of Kuwait. If my hon. Friend puts down a Question about the matter I will consider whether it is right and proper for me to answer it.

Mr. Emrys Hughes: As about four-fifths of the people in Kuwait are illiterate, how do they apply for shares in British Petroleum?

Mr. Lloyd: I do not think that that arises on this Question.

Mr. Shinwell: If the figure mentioned by the hon. Member for Kidderminster (Mr. Nabarro) of £300 million is correct—

Mr. Nabarro: It is correct, otherwise I should not have given it.

Mr. Shinwell: No doubt the Chancellor will check it. Would it not be wise to ask the Ruler of Kuwait out of these huge reserves to pay the bill for what is going on?

Mr. Lloyd: That is quite another matter.

Mr. Nabarro: I will put down a Question.

Invisible Exports

Mr. Nabarro: asked the Chancellor of the Exchequer to what extent invisible exports have declined in the twelve months ended 30th June, 1961, compared with the immediately preceding years; for what reason they have declined; what steps he is taking to assist their recovery; and whether he will make a statement.

Mr. Selwyn Lloyd: I will circulate a table in the OFFICIAL REPORT which analyses under the various heads the invisible payments and receipts for the past three years. The growth of Government overseas expenditure has been an important contributory factor to the decline in our net earnings. Ways of reducing this are being considered.

Mr. Nabarro: Will the Chancellor bear in mind that I am not the only hon. Member who has very great difficulty in analysing the trends of proceeds and revenue from invisible exports, as the figures are not published in any analytical or palatable form to hon. Members or the general public? Can that deficiency be remedied at an early date in order that hon. Members such as myself who take an intelligent interest in these matters can remain continuously informed?

Mr. Lloyd: I hope that my hon. Friend will be benefited by the table

Invisible Account 1958–60


£ million


—
1958
1959
1960
Change 1958–60 (improvement +)


Government:


Payments
…
278
275
332
-54


Receipts
…
56
41
45
-11


Shipping:


Payments
…
615
650
669
-54


Receipts
…
637
625
644
+7


Interest, profits and dividends:


Payments
…
415
420
455
-40


Receipts
…
676
643
634
-42


Travel:


Payments
…
155
173
205
-50


Receipts
…
138
153
188
+ 50


Migrants' funds etc.:


Payments
…
97
92
91
+6


Receipts
…
95
91
91
-4


Other invisibles:


Payments
…
277
312
342
-65


Receipts
…
464
489
514
+ 50


Total invisibles:


Payments
…
1,837
1,922
2,094
-257


Receipts
…
2,066
2,042
2,116
+ 50


Total invisibles (net)
…
+ 229
+ 120
+22
-207

Industrial Production

Mr. Ridley: asked the Chancellor of the Exchequer what the percentage increase in industrial productivity has been over the past year.

Mr. Selwyn Lloyd: Between the first quarter of 1960 and the first quarter of 1961 the index of industrial production

which I propose to circulate in the OFFICIAL REPORT.

Mr. Wilson: Is not the Chancellor aware that we raised this question of invisible balances, which at last has been taken seriously, as a matter of great urgency in the debates on 7th February and 18th April and were given no reply at all from the Government Front Bench? Is he aware that he needs to take firm action about Government expenditure in Germany and to give us the true facts about the oil earnings, on which he has withheld all information from the House? Will he look again at the very serious loss of overseas invisible revenue due to British companies keeping their profits overseas under the O.T.C. provisions of the 1957 Finance Act?

Mr. Lloyd: These matters and a number of others which are also relevant are being considered by me.

Following is the table:

increased by just under 1 per cent. During the same period the numbers employed in the industries covered by the index increased by nearly 2 per cent., so that production per head fell by about 1 per cent.

Mr. Ridley: Does not the Chancellor agree that these are rather disturbing


figures when put alongside the figures for increases in salaries and wages which he gave the House last week? Does it not go to the nub of our economic problem? Can he not suggest means of keeping the two slightly more together?

Mr. Lloyd: It is an exceedingly serious problem. It is lamentable that production has not gone up more. I must add one qualification; last year, productivity per man-hour went up a little, but owing to a reduction in the hours worked the net result was a decrease in production.

Mr. Lee: Will the Chancellor analyse the causes of what he describes as a lamentable performance? Is it not the case that Government policy is by far the most important issue in all this? We know that capital development has gone ahead and that, although there is a shortage of skilled men, nevertheless there are orders for a great many overseas markets. Why does not the Chancellor ally this situation with his own financial policy?

Mr. Lloyd: There are many very broad issues here, such as shortage of skilled labour, restrictive practices generally, whether management is up to date and the whole health of our economy. I spoke frankly about that in my Budget Speech.

National Insurance Funds (Securities)

Mr. Jay: asked the Chancellor of the Exchequer what is the total decline in market values 'between October, 1951, and the end of June, 1961, of the securities held in the National Insurance Fund and National Insurance (Reserve) Fund.

Mr. Selwyn Lloyd: The market value of the securities in the National Insurance Funds in October, 1951, was £1,267 million; the market value of the securities in the Funds on 28th June, 1961 was £1,077 million. These two figures are not strictly comparable, however, due to changes during the period in the amount and composition of the portfolios.

Mr. Jay: Can the Chancellor give the fall in values of the securities which were actually in that Fund in October, 1951? Is it not rather astonishing, however lie calculates them, that there has apparently been a decline of £200 million in

those funds held in trust for the contributors?

Mr. Lloyd: There has been a fall quite clearly, just as by 1951 the fall in the "Daltons" held by the Funds was something like £80 million.

Tourists' Motor Cars (Documents)

Mr. Hirst: asked the Chancellor of the Exchequer if he has now further considered the question of abolishing the carnet/tryptyque forms of documentation for private motor cars temporarily imported into the United Kingdom; and if he will make a statement.

Mr. Selwyn Lloyd: Yes, Sir. From a date shortly to be announced these documents will, for an experimental period, no longer be required for tourists' motor cars, except in Northern Ireland. All that will be required instead will be a very simple form giving brief identification details.

Mr. Hirst: Is my right hon. and learned Friend aware that his decision is very welcome and that it will be a considerable encouragement to the tourist trade? Will he watch carefully the effect this remission has on the Continent, where it has been highly successful, and attempt to make it permanent as soon as possible?

Mr. Lloyd: I shall bear in mind what my hon. Friend has said. Of course, there are certain problems of evasion of duty and we shall have to watch those.

Former Indian Civil Servants (Compensation)

Mr. Glenvil Hall: asked the Secretary to the Treasury how many officers, forced to retire from the Indian Civil Service when the new Constitution came into force and who received compensation therefor, have, since 1st January, 1954, refunded such compensation on establishment in the Home Civil Service; how many of them have refunded or are refunding the full amount received by instalments; and what is the total sum involved.

The Financial Secretary to the Treasury (Sir E. Boyle): I have written to the right hon. Member giving most of the information for which he asks. Twenty-one former members of


the Indian and Burma Services who undertook to make refunds of compensation by instalments have completed their repayments since 31st March, 1954, which is the nearest convenient date. In twelve further cases instalments are still being paid; at 31st March, 1961, the outstanding balances totalled approximately £9,000.

Mr. Glenvil Hall: Is the hon. Gentleman aware that I have had his letter and am grateful for it? When is this practice to cease, in view of the fact that as far back as 1949 a statement was made from the Dispatch Box on be- half of the Treasury that no more compensation would be taken in this way?

Sir E. Boyle: As the right hon. Member is aware, this is a difficult question. I take the view that equity demands that we should continue the present arrangements, which have been applied without exception for many years, but I can assure him that I will of course bear in mind the many points he has made to me. I fully recognise his sincere concern in this subject.

Mr. Glenvil Hall: I beg to give notice that I shall raise the matter on the Adjournment at some convenient time.

Oral Answers to Questions — TRADE AND COMMERCE

Barley

Mr. Farr: asked the President of the Board of Trade what steps he has taken to stop the supplies of dumped barley from France, Russia and West Germany.

Mr. Turton: asked the President of the Board of Trade if he is yet able to make a statement on the application of the National Farmers' Union for antidumping measures against the dumping of barley in the United Kingdom market; and if he will give an assurance that effective measures will be taken before this year's home crop is ready for sale.

Mr. de Freitas: asked the President of the Board of Trade whether he will now make a statement on the National Farmers' Union's complaint that barley is being dumped in this country.

The President of the Board of Trade (Mr. Reginald Maudling): I have considered as a matter of special urgency the application submitted by the National Farmers' Unions on 19th June for the imposition of duties under the Customs Duties (Dumping and Subsidies) Act, 1957, on barley imported from certain countries. I am satisfied that imports of barley into this country have been dumped or subsidised, that these imports threaten material injury to United Kingdom producers, and that there is a case for action under the Act. I am discussing the matter urgently with the countries concerned and will make a further statement before the end of the week.

Mr. Farr: While thanking my right hon. Friend for the statement so far as it goes, may I ask him three supplementary questions? Will he kindly name the countries with whom he has been discussing this question? Will he inform the House if a date has been given by which dumping will cease? Thirdly, will he kindly inform the House what would be the proposed amount of tariff on these dumped barleys which are coming in?

Mr. Maudling: The countries named in the application were Russia, France, America, Western Germany and Australia. I will make a statement before the end of the week. I do not think I should anticipate what it will contain.

Mr. Turton: Will my right hon. Friend bear in mind the latter part of my Question? It is very important that effective measures should be taken before the home crop of autumn barley is ready for sale. Will he also bear in mind that the quantity of barley dumped this year is over 100 per cent. more than last year's total? The cost to the Exchequer is growing very much in the price guarantee as a result of dumping, and urgent action is required.

Mr. Maudling: I am well aware of the need for urgent action. That is why I shall make a further statement this week.

Mr. de Freitas: While we are most grateful that the right hon. Gentleman is to make up his mind more quickly and that he is not to take five months this time as he did last time, may I ask has not the damage done to the taxpayer


been in millions of pounds? What is to be done to prevent this arising in future?

Mr. Maudling: I am aware of the injury threatened to producers in this country. I have to do the best I can to protect their position without doing damage, which could be and should be avoided, to our general trading interests in the world.

Mr. Peyton: Will my right hon. Friend look at the whole question of antidumping legislation, because time and again action is taken too late to protect the interests of the farmer and, most particularly, those of the taxpayer? If it is a fact that application has to be made by the industry for this procedure to be put into effect, does he not think that there should be some legislation to enable him to take action without application from outsiders in order to protect taxpayers' interests?

Mr. Maudling: The fact is that the legislation enables me to act only when I have evidence of damage to an industry. It is framed in that way because of our international obligations. We should be rather careful not to act too precipitately because of the great interests of our export trade in various parts of the world. I cannot act under the antidumping legislation without evidence of damage to industry.

Mr. Lawson: Does not the President of the Board of Trade think that the country has got itself into a most absurd position in that the cheaper our food imports are the more we have to pay by way of subsidies—money from the taxpayer? Is it not about time that we looked at the whole question of subsidies for agricultural production?

Mr. Maudling: That is a much wider question. The question raised is that of dumping, which is quite a separate matter from cheap competition.

Steel Company of Wales (American Coal)

Mr. M. Foot: asked the President of the Board of Trade when he expects to make a statement on the application of the Steel Company of Wales to purchase coal from the United States of America.

Mr. Maudling: I have at present nothing to add to the reply which my

right hon. Friend the Minister of Power gave on 15th May to my hon. Friend the Member for Kidderminster (Mr. Nabarro).

Mr. Foot: Can the right hon. Gentleman tell us when he is to give a final answer on this question? Why is he taking so long to make up his mind on a simple issue of principle? Will he give an undertaking that before he accepts any such proposal as the Steel Company of Wales is putting forward he will take into account the injury which the coal industry has suffered over several years purely because of Government policy?

Mr. Maudling: I hope to make a statement before the House rises for the Summer Recess, but the matter is not as simple as the hon. Member appears to think it is.

Mr. Jay: Since I last asked about this matter, has the right hon. Gentleman had any application from the Steel Company of Wales for the importation of cheap Russian oil to this country?

Mr. Maudling: That is a rather different question. I think the answer is "No", but I would rather see the question on the Order Paper.

North-East

Mr. Grey: asked the President of the Board of Trade, having regard to the fact that the contraction in the mining industry, and shipbuilding and ship-repairing industry has had an important bearing on the migration that has taken place during the past ten years from the North-East, what proposals he now has to bring the kind of industries to the region suitable to the skills of such workers, and other workers, thereby stopping the drift away from the area.

Mr. Ainsley: asked the President of the Board of Trade what proposals he has for dealing with the decline of the basic industries in the North-East, especially West Durham, in order to stop migration from that area to more congested areas.

Mr. Boyden: asked the President of the Board of Trade what studies his Department has made during the last ten


years into the migration of young people from the North-East.

Mr. Popplewell: asked the President of the Board of Trade what steps he is taking to establish new industries in the North-East to assist in stopping the continuing migration of young persons from this area.

Mr. Randall: asked the President of the Board of Trade if he will make a statement on the action he contemplates to establish new industries in the North-East which will provide jobs for young persons and so arrest the continuing migration from this area.

Mr. Maudling: As my right hon. Friend the Minister of Labour said on 26th June, the Government, through their distribution of industry policy, are encouraging firms to develop in parts of the country where unemployment is relatively high and discouraging firms in already congested areas The number of new jobs at present in prospect in the North-East is 21,000, including 10,000 in the development districts. The projects giving rise to these jobs extend over all the main areas of unemployment in County Durham, including West Durham. They should provide opportunities of suitable work both for the skilled workers now unemployed, and for young persons, and thus help in reducing migration from the area.

Mr. Grey: Is the right hon. Gentleman aware that, whatever he thinks he is doing, he certainly is not doing enough? It can be seen from the Census Report that the position in the North-East is far from rosy. Will he stop fiddling with the problem and be more precise about the type of industry he intends to induce to go to the North-East? Will he consult his right hon. and learned Friend the Chancellor of the Exchequer and ensure that, if there are to be any economic restrictions such as the payroll tax, the North-East will be excluded from their operation?

Mr. Maudling: That is a fairly wide range of supplementary questions. I have no powers to order firms to go to the North-East, and I am sure that the House would not wish me to have such powers. We discussed that question when the Bill was passing through the House. Within that limitation, we do all we can to

encourage firms to go to the North-East and we are making quite considerable progress.

Mr. Ainsley: Is the right hon. Gentleman aware that the people of the North-East look upon this as the major failure of the present Government? Is he aware that economic pressure is driving people away from the North-East to where they have never had it so good in the Midlands and the South? Will he do something to keep people in the North-East, where they are anxious to stay? The area has been scheduled under the Local Employment Act. We are told that something is coming in the dim and distant future, but not at present.

Mr. Maudling: I do not think that anyone in the North-East who looked at this matter objectively would share the views of the hon. Member. We have made great progress there, as we have in other districts. My powers under the Local Employment Act are to deal with the problem of local unemployment. They are not to deal with the whole question of migration. The Government have not the power, and in my view should not have the power, to freeze the population in its precise location.

Mr. Boyden: Would the right hon. Gentleman get himself out of the pipeline he is in at present?

Mr. Maudling: If I understood that question, I would certainly try to answer it.

Mr. Randall: Is the right hon. Gentleman aware that, despite the 21,000 jobs in prospect, to which reference has been made on a number of occasions, his right hon. Friend the Minister of Labour only recently reported that for the last four weeks there was a number of filled vacancies and that these were the lowest of any region in the country in comparison with figures of unemployment? This has gone on for a considerable period. Does not this fact of itself suggest that there is a very strong case indeed for bringing industries to the North-East?

Mr. Maudling: I agree. There is a strong case, and we are trying to do that. However, I have no powers to compel people to go there, nor would I wish to have such powers.

Mr. R. W. Elliott: Does my right hon. Friend agree that, in addition to the constant demands which are made for Government action to bring new industries to the area, recognition should be given to the existing industry there? It has made enormous efforts to retain prosperity in the North-East. Would my right hon. Friend agree that in technical advance and in its excellent labour relations the North-East compares very favourably with any other area in the country?

Mr. Maudling: Yes, I agree. I do my best to bring that fact to the attention of all employers who consult me on location problems.

Mr. Grey: On a point of order. In view of the very unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise the matter on the Adjournment at the earliest possible moment.

British Film Fund Agency (Payments)

Mrs. White: asked the President of the Board of Trade if his attention has been drawn to the dissatisfaction felt by British film producers at the delays in the payments made by the British Film Fund Agency; and if he will take steps to speed up these payments.

Mr. Maudling: I am satisfied that the British Film Fund Agency carries out its responsibilities efficiently and in general as expeditiously as circumstances allow. Informal talks between the Agency and the film trade associations concerned will shortly take place, and I hope that they will clear up any outstanding points of difficulty.

Mrs. White: Will the right hon. Gentleman keep this matter in mind? Is he aware that it is very important for smaller film producers especially to have prompt payments? It appears that the Agency is keeping back a disproportionate amount of its funds, instead of paying them out to producers.

Mr. Maudling: I think that there may have been some misunderstanding here. I hope that the talks to which I have referred will clear the matter up. I will certainly keep it in mind.

GERMANY

Mr. Longden: asked the Prime Minister whether, in his diplomatic intercourse with other heads of allied Governments, he will consider as a possible solution to the problem of the Soviet zone of Germany the suggestion first put forward in this House by the hon. Member for Hertfordshire, South-West on 12th May, 1960, namely, that it should become a separate state having a reunited Berlin as its capital whose independence and neutrality are guaranteed by the Western Powers and the Union of Soviet Socialist Republics on the Austrian model.

The Prime Minister (Mr. Harold Macmillan): Our policy towards Germany and Berlin remains as stated in the Western Peace Plan which was put forward at the Geneva Conference of Foreign Ministers in 1959, and which remains allied policy.

Mr. Longden: Does my right hon. Friend recall that Chancellor Adenauer is reported to have said some months ago that
if we can help them"—
that is, the East Germans—
to live better and more freely, then that is more important than anything else."?
Does my right hon. Friend agree that this solution, or some such solution as this, would reunite Berlin in freedom, would not impair N.A.T.O. in any way, and would provide a cushion of reassurance between the Soviet Union and Berlin, on the one side, and the Federal Republic of Germany on the other? Would he be prepared to look at this again?

The Prime Minister: No; because the Western Peace Plan is really a phased programme for German reunification. My hon. Friend's proposal in effect rules out reunification.

Mr. S. Silverman: Is it true that the proposals on which the Western allies now appear to be standing amount to this, that the Potsdam Agreements are obsolete in every part of Germany except Berlin?

The Prime Minister: No. The problem confronting us is a difficult and tangled one. It will require a considerable degree of agreement between all the


allies. I do not think that it would be in the public interest for me to comment upon what the hon. Gentleman has said; I do not think that it would help to solve our difficulties.

BUILDING LAND (MINISTER'S STATEMENT)

Mr. Donnelly: asked the Prime Minister whether the statement regarding building land speculation made by the Minister of Housing and Local Government and Minister for Welsh Affairs on 19th June in London represents the policy of Her Majesty's Government.

The Prime Minister: If the hon. Member is referring to a report in the Daily Mail that day of an interview with my right hon. Friend the Minister of Housing and Local Government, the answer is, "Yes, Sir".

Mr. Donnelly: Is the Prime Minister aware that I was referring to the report in the Daily Mail, which discloses no policy whatsoever on the part of the Government? In those circumstances, how can the Prime Minister agree with a nil policy, or is he saying that the one flashing phrase of the Minister of Housing and Local Government
I am not sitting around doing nothing
is a declaration of the Government's policy?

The Prime Minister: No. The hon. Gentleman has completely misrepresented what is in the article. As I understood my right hon. Friend, he reaffirmed our determination not to allow the green belt policy and other important planning objectives to be sacrificed and said that those who were speculating in land in the hope that pressure would be brought to abandon the green belt policy were likely to burn their fingers.

Mr. Gaitskell: Is the Prime Minister aware that we on this side welcome the warning to speculators against the danger of getting their fingers burned, providing that the warning is backed up by some kind of policy? Is he now telling us that all that the Minister of Housing and Local Government meant was that he would not give way on green belts but would do nothing else to deal with the scandal of land prices?

The Prime Minister: No. The Minister of Housing and Local Government made some other observations. I was picking out one which I thought particularly apt in view of the misrepresentation of the hon. Member for Pembroke (Mr. Donnelly).

Mr. Gaitskell: When may we expect from the Government an announcement of their policy in this matter?

The Prime Minister: If the right hon. Gentleman reads the article he will see that it contains some very valuable statements of policy.

Mr. Gaitskell: Is not the Prime Minister aware that it is precisely because it contains no content whatever that I asked him when we would have a statement on policy?

The Prime Minister: The right hon. Gentleman is quite wrong. He is associating himself with the mis-statement made by his hon. Friend below the Gangway.

Mr. Donnelly: In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.

IMMIGRATION FROM THE WEST INDIES (HOME SECRETARY'S STATEMENT)

Mr. G. M. Thomson: asked the Prime Minister whether the statements made by the Secretary of State for the Home Department on the subject of immigration from the West Indies at a meeting of the Conservative and Unionist Teachers' Association in London on 17th June represents the policy of Her Majesty's Government.

The Prime Minister: I refer the hon. Member to the Answer I gave to the hon. Member for West Ham, North (Mr. A. Lewis) on 22nd June.

Mr. Thomson: Is the Prime Minister aware that in this case the Home Secretary characteristically let the cat out of the bag? He said that the Government were contemplating legislation to restrict immigration. He used the phrase that this would be based not on colour prejudice alone. Is the Prime Minister aware that this unfortunate phraseology caused


widespread offence? Will he repudiate this statement and affirm that the Government have no intention of introducing legislation which is in any way discriminatory or based on colour prejudice?

The Prime Minister: The Government's position has been made clear in the House on many occasions and I do not see any need to add to it.

Mr. Woodnutt: Does my right hon. Friend agree that unless the Government tackle the problem soon the flow of immigrants is likely to affect the employment position and hon. Members opposite and the trade unions in particular will be the first people to say, "Let us put a ban on non-British labour"?

The Prime Minister: That is quite a different question. I am asked in the Question whether I agree with the Home Secretary's statements. I have said that I think they were in conformity with what has been said over and over again in recent months.

Mr. Hale: If the authentic notes of all these pronunciamentos were recorded on menu cards, would it not be possible to introduce a card-indexing system so that we could become aware of all the future disasters to which the nation has been committed?

The Prime Minister: If the hon. Gentleman thought that out while he was sitting there, it is quite good. If he thought it out before, it is not really so good.

COMMON MARKET

Sir T. Moore: asked the Prime Minister, in view of the need for more public information on the facts relevant to the problem of British membership of the Common Market, if he will now publish a White Paper limited to the relevant statistical and factual information.

Mr. Dugdale: asked the Prime Minister whether Her Majesty's Government now intend to issue a White Paper setting out the facts and statistics relevant to consideration of the question of Britain's entry into the Common Market.

The Prime Minister: I will certainly consider whether a Paper could be pro-

duced on the lines suggested. The range of factual information which is relevant to this complex question is very wide. A White Paper which contained only some of the obvious facts could give a very misleading impression. If an attempt were made to widen the scope of the White Paper and to publish detailed information, however factual, over a broader but still necessarily selective field, the result might be taken as carrying implications for our conduct of any negotiations which it might be decided we should undertake.

Sir T. Moore: While I am deeply grateful to my right hon. Friend for his reply, I should like to ask him two supplementary questions. In view of the confusion and doubt, and even suspicion in the public mind—as well, indeed, as in this House—does he not think that it would be wise for some sort of objective statement, or a White Paper, to be published, setting out the short-term and long-term possible advantages and the short-term and long-term possible disadvantages to us if we joined the Common Market? Secondly, in his own judgment, does my right hon. Friend think that it will be possible to bring our Commonwealth friends, our partners in Europe and our farmers into this Common Market and yet retain the broad conception of European integration?

The Prime Minister: I quite see the object and value of producing some kind of document, and I have been trying to start work on it. There is the quite separate question which I undertook to consider, and which I hope to be able to meet, which was merely to give information of the measures taken by the parties to the Treaty of Rome in implementation of its Articles on common organisation and institutions. If we could obtain that, it would be possible to produce a factual, objective statement on them, but I still have a little doubt. I still find it difficult to reconcile this with the real purpose of a White Paper. Giving the arguments for and against is not quite the function of a public document published by the Government as such. If I can help, I will do so, but I think that hon. Members will see the difficulty. If the Government were asked to produce a White Paper for or against a much-debated policy, are the facts and the


kind of objective statements really suitable to a Government White Paper? That is my difficulty, and that only.

Mr. Dugdale: One appreciates the Prime Minister's difficulty, but does not he realise that until a Paper is published that does give the facts for and against, the country is being asked to buy a pig in a poke and that unless the Commonwealth countries now being visited by Her Majesty's salesmen are also informed of the profit or loss to them, they, too, are being asked to buy a pig in a poke?

The Prime Minister: I think that the very phrase the right hon. Gentleman uses illustrates just the difficulty. He says that we must publish a White Paper about the facts and arguments, but that is just the one thing one cannot do about an argument.

Mr. S. Silverman: Would the Prime Minister explain more clearly why he would be so embarrassed in a future negotiation if he published the facts and statistics on which the negotiation must necessarily be based? Is the Common Market the kind of game where it is really necessary for each player to hold the cards as close to his face as all that?

The Prime Minister: Well, there are some differences between holding the cards very close to one's chest and putting them all, before any negotiation starts, face downwards—[HON. MEMBERS: "Upwards."]—on the table.

Sir G. Nicholson: Would not my right hon. Friend agree that though publishing arguments is, of course, dangerous, there is room for some simplification of the main documents? The Treaty of Rome is pretty tough reading. Could not my right hon. Friend produce a Treaty of Rome "told to the children"?

The Prime Minister: Of course, if it is valuable merely to summarise existing documents, that is one thing, but that was not what I was asked for.

CENTRAL AFRICA (DEFENCE ARRANGEMENTS)

Mr. G. M. Thomson: asked the Minister what consultations he has had with the Prime Minister of the Federation of Central Africa regarding joint arrangements for defence in Africa.

The Prime Minister: Consultations with the Federal authorities are naturally close and continuous.

Mr. Thomson: Is the Prime Minister aware that the Federal Defence Ministry has announced joint military exercises with the South African Air Forces? Is not that a very serious step to take with what is now a foreign country without full consultation with Her Majesty's Government? Would not the Prime Minister try to use his persuasive powers with Sir Roy Welensky, and tell him that this kind of policy will isolate him still further from world opinion?

The Prime Minister: That is another question, but, with regard to our own arrangements with the Federal Government, we naturally have close consultation, and I should like to express my gratitude to the Federal Government for their help in a recent crisis in which we now find ourselves.

Mr. Thomson: Would the right hon. Gentleman answer the specific point of whether Her Majesty's Government were consulted about these new defence arrangements between the Federal Government and the South African Government?

The Prime Minister: I should like to see that question on the Order Paper.

PORTUGAL (SUPPLY OF ARMS)

Mr. Awbery: asked the Prime Minister whether he will make it a condition that, when arms are supplied to Portugal under North Atlantic Treaty Organisation arrangements, they will not be used in Portuguese territories overseas.

Mr. Brockway: asked the Prime Minister if he will make it a condition of supplies of military equipment to Portugal under North Atlantic Treaty Organisation requirements that such equipment should not be used in Portuguese overseas territories.

The Prime Minister: In considering applications for the export of arms to Portugal, we shall have regard to the nature and quantity of equipment in relation to her reasonable requirements as a N.A.T.O. ally. This has been explained to the Portuguese Government, and I do not think that formal conditions


about the use of any military equipment that may be exported are necessary or appropriate.

Mr. Awbery: Is the Prime Minister alive to the grave indignation felt in this country at the thought that we are supplying arms to Portugal, either directly or through the North Atlantic Treaty Organisation, which are being used to crush the people of Angola? Will he take steps to stop this trade immediately, and will he indicate to the Portuguese Government our disgust at and disapproval of what is being done? Is the right hon. Gentleman aware that making excuses that it is not our responsibility is just a washing of his hands, like Pilate in the past, and saying that we are innocent of these things when we are guilty?

The Prime Minister: As I said to the House some days ago, the position is that no licences for the export of arms or ammunition are, in fact, being made in respect of Angola or Mozambique. That does not affect certain large deliveries of equipment that are only suitable for Portugal in her place as a N.A.T.O. ally.

Mr. Brockway: How can the right hon. Gentleman possibly distinguish between armaments supplied for N.A.T.O. purposes and armaments that could be used in Angola? Is he not aware that at this moment armaments supplied for N.A.T.O., including the napalm bomb, are being used by the Portuguese Government in Angola? Is it not the case that Portugal itself is the base of the policy in Angola, and that if Portugal is built up, its policy in Angola is also being supported?

The Prime Minister: As regards the supplies of weapons that may have been supplied in the past, I do not know. All I know is that as regards licences in the last few weeks, or even longer, we have been applying this rule. I do not, for instance, see how to continue work in a British shipyard on two frigates that were sold some months ago and cannot be delivered for some time, can assist or play any part in the rather tragic events now going on in Angola.

Mr. Gaitskell: Can the Prime Minister explain what is the point of putting an embargo on the export of arms to Angola when arms can go freely to

Portugal and be sent from there to Angola?

The Prime Minister: In giving these export licences, such is the great width and variety of arms that are likely to be asked for that I think that it is quite possible to operate this policy effectively.

Mr. Gaitskell: The right hon. Gentleman has not answered the question. What we are concerned with is this. If, in fact, the Government have out off the supply of arms to Angola, as they have done, it is presumably because they think it against our interests that they should go there. Since it is perfectly possible for the arms to go from Portugal to Angola, does he not think that the Government should take the logical step of putting an embargo on the export of arms to Portugal?

The Prime Minister: No, Sir. I think that there are certain arms that it is right for us to be ready to continue to sell to Portugal for N.A.T.O. purposes.

Mr. Gaitskell: Would it not be better to discriminate between the different kinds of arms being sent to Portugal, instead of simply imposing an embargo on the export of arms to Angola and doing nothing about the export of arms to Portugal?

The Prime Minister: Any licences for Angola are obviously likely to be asked for because the arms would be useful to Angola.

Sir R. Grimston: Has my right hon. Friend seen a letter in The Times of this morning in which it is suggested that this vendetta against Portugal is quite out of proportion?

The Prime Minister: We deeply regret, of course—and this is a very large question—the situation that has developed there, but I do not honestly' think—and the House, on reflection, I think will agree—that to try to cut off Portugal from membership of the N.A.T.O. alliance at this time would help in any influence that we may have on them.

Mr. Brockway: On a point of order, Mr. Speaker. I beg to give notice that, in view of the very unsatisfactory reply of the Prime Minister, I will seek to raise this matter on the Adjournment at the earliest opportunity.

QUESTIONS TO MINISTERS

Mr. G. Brown: On a point of order, Mr. Speaker. Question No. 50 deals with a matter about which the Minister of Defence has already complained in this House about not being consulted over the visit of the Second Squadron of the Home Fleet to Lisbon. In view of the public importance of this matter, may I ask whether the Prime Minister has asked your permission to answer this Question, in fairness to his colleague?

Mr. Speaker: The right hon. Gentle man has not asked my permission.

Orders of the Day — FINANCE BILL

Order read for resuming adjourned debate on Amendment proposed [3rd July] on consideration of the Bill, as amended (in the Committee and on recommittal):—

Clause 8.—(SURCHARGES OR REBATES OF AMOUNTS DUE FOR REVENUE DUTIES.)

Which Amendment was, in page 6, line 8, after "subsection", insert:
shall not be made before the end of a period of three months commencing on the date of the passing of this Act and".—[Mr. Houghton.]

Question again proposed, That those words be there inserted in the Bill.

3.30 p.m.

Mr. Speaker: I think that it would be helpful for the House to discuss with this Amendment the Amendment to Clause 27, in the name of the hon. Member for Huyton (Mr. H. Wilson), in page 21, line 21, to leave out "with" and to insert "three months after".

Mr. Harold Wilson: I think that it would be for the convenience of the House to discuss these two Amendments together, although they relate to different regulators, the one relating to the taxation regulator and the second relating to the payroll tax—but the point at issue is the same in both cases: to delay their use until three months after the Finance Bill has become law.
The Amendment was moved last night formally by my hon. Friend the Member for Sowerby (Mr. Houghton) and its purpose will, I think, be clear to the House. We are seeking to ensure that in respect of both the first economic regulator, relating to surcharges on indirect taxation, and the second in relation to the payroll tax, the Chancellor shall not have power to introduce these measures for a fixed period after the Finance Bill has become law.
I do not know how far it would be in order for me to go into the merits or demerits of the regulators. In any case, I do not propose to do so this afternoon, because my hon. Friends and I made it clear during our debates in committee that we were fundamentally opposed to the payroll tax right along the line and


we voted against it. Therefore, our Amendment today, which is designed to provide that the payroll tax, at any rate, cannot be introduced during a period of three months, must not be taken as implying acquiescence for the principle of the payroll tax.
The payroll tax is a bad tax. My hon. Friends and I have drawn attention on several occasions to its unfair incidence as between industries—those which use a good deal of labour and little capital and those which are capital intensive and make less call on the country's labour reserves. We believe that it is particularly invidious, anomalous and unfair as between the essential services. There is an Amendment on the Notice Paper relating to local authorities, but I do not think that it will be selected on the ground that it is out of order. It is precisely because we knew that it would be out of order that we did not table the Amendment.

Mr. Speaker: I am not sure, but I think that the right hon. Gentleman may himself be going out of order now. The question involved in this Amendment is, aye or no, the point of time at which the regulator shall be enforced.

Mr. Wilson: Yes, Mr. Speaker, but I thought that it would be in order for me briefly to refer, on this question of three months, to whether this would have a serious effect on such things as local authorities, hospitals or other essential services, the problems of which we raised as early as the Budget debate on 18th April. It was, in fact, our first reaction to the Chancellor's proposals.
It will be quite clear to the House that hon. Members on this side are utterly opposed to the payroll tax. I know that a number of hon. Gentlemen opposite are equally opposed to it. It is my own private view that it is doubtful whether we shall ever see this tax in operation. I believe that it was introduced in a fit of misguided enthusiasm by the Chancellor at Budget time. Obviously, there was a terrible row between the right hon. Gentleman and the Minister of National Insurance concerning the use of National Insurance as a tax gatherer and I think that the Chancellor will probably bow to the inevitable, but that he will not do so to the extent of taking the provision out of the Bill.
Therefore, we shall have a lot of support from hon. Gentlemen opposite for our proposal that for at least three months after the Finance Bill has become law the Chancellor shall not be free to introduce this taxation. I urge hon. Members to realise that if we carry it as long as October and November and the Chancellor cannot introduce the payroll tax until then—after the period of seasonal pressure on sterling—then, conscious of the fact that he has given the pledge that he will scrap the present arrangement next April, it will hardly be worth his while to introduce it for two or three months
Thus, the second of the two Amendments is obviously one which will be highly acceptable to a number of hon. Gentlemen opposite; those who wish to move on this matter, but who show a reluctance to strike so far as this question is concerned. I propose, therefore, having made it clear that my hon. Friends and I are fundamentally in opposition to the tax, to concentrate most of my remarks on this Amendment on the problems of the surcharge on indirect taxation.
We have already made plain our feelings about this matter. We welcome the fact that the Chancellor has, at any rate in his Budget speech and in the framing of the Bill, come to the conclusion that, in general, the monetary mechanism on which his predecessors showed such dangerous overreliance is too much of a blunt instrument. The present Chancellor is prepared to introduce fiscal regulators to supplement the monetary weapon, though to judge from his answers at Question Time today he still sounds an utterly convinced supporter of high interest rates, despite all the damage that they do.
We have expressed our concern about the surcharge on indirect taxation. While welcoming the Chancellor's decision to rely rather less on the monetary weapon, my hon. Friends and I have expressed concern about the lack of parliamentary control over the operation of an instrument which enables the right hon. and learned Gentleman to introduce £200 million of taxation by the stroke of the pen. I will not pursue this matter further now because there is another Amendment which relates to the period during which the Chancellor


must secure parliamentary ratification for any action he takes in respect of either or both regulators.
It cannot have escaped the notice of hon. Members that if the right hon. and learned Gentleman does introduce this surcharge on indirect taxation he will be raising the cost of living. There can be no doubt about that. I hope that the Chancellor will be able to give an authoritative figure this afternoon as to the extent to which the cost of living would be raised if he invoked the regulator. It is widely believed in the City, the financial Press, the trade union movement, industry, commerce finance and distribution that the Chancellor is only waiting to hear of the Royal Assent to the Bill to introduce this regulator within a matter of days and to get Parliamentary ratification before we adjourn for the Summer Recess.
This is widely believed to be the case. If the Chancellor were to do this, after a period in which the cost-of-living index has risen some four points in just over a year, when the Chancellor himself is so deeply concerned about the wage and prices spiral, obviously we must consider the wisdom of giving the Chancellor a power like this, because there would be an immediate increase in the cost of living.
I do not think that the House will be in any doubt that even if the Chancellor does this as a temporary measure, it will find its way into the whole structure of costs and prices; and even if he were to remove the surcharge in six, nine or twelve months' time we should never see prices fall again as a result. Every time that prices have been raised as a result of any fiscal or other measure, they have become ossified permanently so far as the economic situation is concerned. [Interruption.] I see that I have support from both sides of the House.

Mr. Gerald Nabarro: I am supporting the word "ossified".

Mr. Wilson: It is a nice word. I expect that we shall hear it from the hon. Member on a future occasion.
We are, therefore, facing the danger of the Chancellor taking this action immediately. I want to make it plain that if the Chancellor does not defer the operation of this provision he will not get any acquiescence from us. We shall

oppose any action of this kind, not only the payroll regulator but any other regulator.
I have given one reason for our opposition to this provision, namely, that it would of itself impart an additional twist to the inflationary spiral. We know that the Chancellor has about him Ministers who cling to the philosophy of economics which I once dignified with the title of "Boyle's Law." The name, I think, has stuck ever since. It is interesting to recall that the present Chancellor enunciated during the Budget debates something that he called "Lloyd's Law", which has not really caught the popular imagination to the some extent. It seems to have been forgotten. I doubt whether many hon. Members know what "Lloyd's Law" is: "Boyle's Law" we certainly understand.
I remember that when the present Home Secretary was succeeded by the present Prime Minister as Chancellor I went so far—and I have always regretted my choice of words—as to describe the Financial Secretary as Treasury Rasputin who seemed capable of convincing Chancellors, on widely different views, of the merits of the proposal that the right way to bring the cost of living down was to put prices up. That was obvious to us a fundamental tenet of the hon. Gentleman's philosophy as long ago as 1955–56. It is obvious that Rasputin has converted yet another czar. The present Chancellor, in accepting this regulator, shows that he thinks the Financial Secretary is right—

Mr. A. E. Cooper: I am bound to say in defence of my hon. Friend the Financial Secretary that the late Sir Stafford Cripps and the present Leader of the Opposition did precisely the same thing and were equally wrong.

Mr. Wilson: I would be prepared to handy words with the hon. Gentleman, but I do not know what particular action of theirs he had in mind. I do not remember either of them saying that the right way to bring the cost of living clown is to put prices up.

Mr. Cooper: Both right hon. Gentlemen to whom I have referred, in times of inflation, severely increased taxation in the hope that it would stem inflation, and it had exactly the reverse effect, as some of us knew it would.

Mr. Wilson: Yes, I remember, particularly in the case of my right hon. Friend the Leader of the Opposition in the Budget of 1951. It was admittedly controversial at the time. I do not think that any of us would disagree, though, that at the time when a war was going on in Korea and costs were rising it would have been dangerous to have failed to have a really marked disinflationary Budget. But that is not the issue under the present Chancellor's Budget. There has not been much debate about the size of the present surplus.
3.45 p.m.
The issue is that in the autumn Budget of 1955, and in successive Budgets, and more particularly In the Chancellor's regulator, he has got this idea that one can cream off inflationary purchasing power by putting prices up, particularly on essentials, and that if that happens people will have less money to spend not only on essentials, but on other things. It is the old argument. We had it night after night in the autumn Budget in 1955, that if we tax clothes pegs, babies' baths and things like that—

Mr. Speaker: The right hon. Gentleman has been so good and helpful that I regret having to interrupt him, but really I think that he is a very long way from the issue which arises on these Amendments. If I were to indulge the right hon. Gentleman, I should blackmail myself into indulging others.

Mr. Wilson: Of course, I accept what you say Mr. Speaker. I should point out that the acceptance of these Amendments will result directly in preventing for three months the Chancellor imposing a tax on babies' baths, clothes pegs, clothes-line posts and other things.

Mr. Douglas Jay: And beer.

Mr. Wilson: And beer, tobacco and other items. We are debating whether the Chancellor should be given a taxing power over all these commodities. Those commodities are within the ambit of this Clause, although, naturally, I do not wish to trespass too far on your generosity, Mr. Speaker.

Mr. Speaker: The right hon. Gentleman is arguing that the Chancellor should not be entrusted with this power immedi-

ately. I follow the argument that the power is wide-ranging, but its significance here is only whether he should have the power immediately or after three months.

Mr. Wilson: Yes. Perhaps I can conclude that part of the argument by saying that the Rasputin argument here is one that implies that by taxing essentials people will have less money to spend on other things. That is what lies behind these two Clauses, and we are now considering whether the Chancellor should have this power immediately the Finance Bill becomes law, or at a period three months thereafter.
I have mentioned one danger about this provision. If our Amendment is not accepted, the Chancellor will have the power this summer to give an additional twist to the inflationary spiral. Even the Financial Secretary will agree that the first result will be to push up prices. It will be quite impossible for the Chancellor to go to the trade unions and talk about wage restraint, and so on, when he himself, by his own action, is putting up prices, not temporarily, not for the duration of the period in which the surcharge is in force but permanently because of the ossificatory element in our economic structure, which has been so warmly seized upon by the hon. Member for Kidderminster (Mr. Nabarro). That is one argument.
Now I come to my second argument. Here, there is a very important question of relations between the Executive and the Legislature. This House has always been extremely jealous about giving taxing powers to a Chancellor, however respected the Chancellor might be. I think our predecessors in this House, a hundred or even fifty or twenty years ago, would be shocked at the thought that in a Bill of this kind we could give power to the Chancellor to increase £400 million or £500 million worth of taxation by a stroke of the pen without Parliamentary approval except that which comes afterwards—what I understand, in terms of the General Agreement on Tariffs and Trade, is called approval a posteriori, which means that you can give the Chancellor a kick in the pants afterwards but you cannot do it in advance.
This is a very serious power that we are conferring on the Chancellor and it is right to decide whether he should


have it immediately the Bill becomes law. We are ratifying a miscalculation on the part of the Chancellor by giving him this power. If the Chancellor had thought in April, when he introduced this Budget, that the inflationary-deflationary situation—the balance of the economy—was such that he would need another £200 million or £400 million worth of taxation in July, he should have told us so in April. If not, I think that he would be guilty of very bad faith so far as the House is concerned, and I personally acquit him of that charge.
I do not think that in April, when the Chancellor introduced this power, he intended, immediately the Finance Bill became law, to impose this surcharge and this payroll tax. I do not think that he intended to do that. If he had wanted another £400 million of taxation, I think that, difficult though it would be with that kind of Budget, he would have come honestly to the House and said so in his Budget speech. I am sure that the right hon. and learned Gentleman will tell us that when he replies to the debate.
We now have a situation where, if I am right, the Chancellor intends to use at any rate one of the regulators, and already, on 4th July, only two and a half months after the Budget, the Chancellor has miscalculated grievously and he has to come along and say so. Within three months of the Budget —that is about the time that the Finance Bill becomes law—the Chancellor has to put his miscalculations right by introducing what is, in effect, a summer Budget.
There are three differences between this miscalculation and the miscalculation of the Home Secretary. One is that this was not made to influence an election. The second, of course, is that, whereas the Home Secretary's mistake required an autumn Budget, this would be a summer Budget. The third is that whereas an autumn Budget or any other kind of Budget requires full-dress debates in Parliament, right through the night, Ways and Means Resolutions, a Finance Bill, Second Reading, Committee stage, Report stage and Third Reading, the instrument which the Chancellor is here taking power to exercise requires none

of that trouble and none of that, if I may say so, relative humiliation for a Chancellor who has miscalculated.
We should be extremely careful about giving a Chancellor power immediately the Finance Bill is passed to put right a miscalculation of the previous April. I hope that the right hon. and learned Gentleman does not misunderstand what I am saying. I do not think that he misled the House in April. I do not think that he then thought that, as early as July, he would be using this power. He thought that he might probbaly want it at some time in the year. We have not voted against giving him the power for future years to use whenever it seems appropriate, subject to Parliamentary approval. But there is a difference about its operation in the first year because, if he uses it immediately, this means either bad faith—of which I am only too ready to acquit him—or complete miscalculation. If he makes a miscalculation of that kind and if he finds, three months after the Budget, that he needs all this additional revenue, he ought to come along with a second Finance Bill. After all, the Home Secretary did not run away from it. He would probably have been Prime Minister today if it had not been for the disaster of his autumn Budget. That, I think, was really what finished the right hon. Gentleman from that point of view.
I trust that the House and the Chancellor will accept the strength of the case I am trying to put. If the Chancellor has miscalculated—there is every sign that he has, and we shall know within a very few weeks, if he imposes the regulator—why should not he, like any other Chancellor, have to face an autumn Budget? The future is another matter. Parliament is, rightly or wrongly, giving him a power for the future—wrongly, in the view of some of my hon. Friends—but I do not think it is right that the power should be given to him immediately.
It is very difficult for us this afternoon to pursue all the arguments which might occur to one on this Amendment, because the Chancellor has not yet announced his intention of imposing the regulators. I do not think that he can. He cannot do it at once because of his inability to carry out his intention until the Bill becomes law and because of the


uncertainty which would be caused in trade and industry. But he should know that there is already very great uncertainty in trade and industry. Already, one hears of people talking about speeding up their purchasing because they think that they will have to pay increased Purchase Tax on their purchases in two or three months. This is very harmful and the reverse of disinflationary. The Chancellor is worried about inflationary demand at this time.
What are the powers which the Chancellor has the operation of which we seek to defer for at any rate three months? First, there is the power to increase Purchase Tax. I think that the House will recognise that that power already inheres in the Chancellor's armoury as a result of legislation introduced years ago by the Labour Government. Secondly, there is the Beer Duty. If the Amendment I have moved is rejected, the Chancellor will be able, two or three weeks from now, to increase the Beer Duty by 10 per cent. In other words, he could go a very long way to reverse, without any specific parliamentary approval, the pre-election tax hand-out of his predecessor, now Lord Amory, which, of course, was designed to influence the General Election of 1959. The 2d. was knocked off beer just before the election, and now the Chancellor can put most of it back.

Mr. Nabarro: He put it on cigarettes, anyway.

Mr. Wilson: I am coming to that.
The Chancellor can now put it back. I know that he cannot put the whole 2d. back because the brewers themselves have put 1d. back—2d. in some cases. Thus, one result will be that, without any parliamentary approval at all, the price of beer will be above the pre-election figure. No doubt, hon. Members opposite—I do not know whether they made a lot of it in their speeches—were not too sorry to hope for a few votes coming to them as a result of the popularity of the then Chancellor in the public houses.
I come now to cigarettes. There was, of course, no pre-election cut in the tax on cigarettes as there was on beer, but it is a fact that, immediately after the election, the Government increased the tax on cigarettes. If I remember aright, the hon. Member for Kidderminster

joined us in the Lobby, or we joined him—there will always be theological argument about who joined whom—against that.

Mr. Nabarro: The right hon. Gentleman must put the matter in correct perspective. What I objected to in my speech of 5th April, 1960, was the practice—the fiscal mispractice, I called it—of taking 2d. off beer before an election and putting it back on cigarettes after an election. But, in the context of the right hon. Gentleman's argument now, it is all square.

Mr. Speaker: This discussion becomes out of order unless one postulates a General Election within the three months' deferment.

Mr. Wilson: Under your Ruling, Mr. Speaker, I am bound to say that, because the likelihood is that the tax will go up rather than down, I do not myself expect a General Election within the three months.
If the economic situation were such that it seemed possible that the tax might go down, I should myself be highly suspicious of that possibility. I think that the hon. Member for Kidderminster was trying to lead me further into sin than I was voluntarily going. I was reciting the various items of taxation in respect of which the Chancellor will have power to impose a surcharge, if the Amendment be rejected, immediately the Finance Bill becomes law.
I mentioned beer. I mentioned the Purchase Tax. I mentioned tobacco. There are other items, wines and spirits, the Pool Betting Duty, and a whole range of Customs and Excise duties apart from those import duties which are the subject of international agreements, governed by the G.A.T.T., and so forth.

Mr. Leslie Hale: I do not want to take my right hon. Friend out of order, but he did deal with the possibility of an election. I hope that he is not giving away the high constitutional principle that, if there is any question whatever of any abrogation of sovereignty involved in our joining the Common Market, then a General Election is inevitable before any possibility of that kind comes about.

Mr. Wilson: I think that I should be out of order—

Mr. Speaker: We had better keep the Common Market out of this three months' deferment.

Mr. Wilson: I thought that I should be out of order, Mr. Speaker, if I responded to the question put by my hon. Friend.
I merely say to my hon. Friend and to the House that, as a result of a small Amendment which we got through at an earlier stage, there is no question of changes in this taxation during an election campaign. Therefore, if an election does occur within the three months, it will, I think, be a matter of great satisfaction to hon. Members on both sides of the House to know that the Prime Minister will not be free to remit indirect taxation between the date of dissolution and polling day. If my hon. Friend had any doubts on that issue, he may take it that it is out of the way as a result of an Amendment passed in Committee.
4.0 p.m.
We consider it economically wrong that the Chancellor should have power at this time to introduce either of the regulators, the payroll tax for all the reasons which are known to hon. Members, and the surcharge regulator for the reasons I have explained. First, it would give another twist to the inflationary spiral, defeating all that the Chancellor was trying to do.
Secondly, it is utterly wrong for the Chancellor to have the power, immediately the Finance Bill is passed, to alter the whole basis of his Budget in correcting his Budget mistakes. While it might lead to the suspicion that there had been bad faith at Budget time, that the Chancellor had preferred to do it by a simple regulator because he would not want to do it in Committee, I personally do not believe that the present Chancellor is capable of misleading the House in this way.
At the same time, if the right hon. and learned Gentleman does intend to use the regulator, or if he asks the House for power to use it, within three months of the Bill becoming law, he is obviously asking for power to correct a very great miscalculation, for which any other Chancellor in any other Budget would have been held responsible to the House, and would have been made to

suffer the indignity, trouble and loss of sleep that comes with an autumn Budget.
For all these reasons, I trust that the House will accept this very reasonable Amendment. The Chancellor will still have the power which he thought that he would want in the Budget, but he will not have the additional power of correcting the mistakes which he apparently made on Budget day.

Sir Derek Walker-Smith: The right hon. Member for Huyton (Mr. H. Wilson) has taken a long time to make what is really a short point. I hasten to say that I make no complaint about that, because one of my most enjoyable and least expensive pleasures is listening to the speeches of the right hon. Gentleman in this House. As I can hardly dare to hope that he reciprocates the compliment, I shall make my short point with a good deal more brevity than he has achieved.
As I understand, we are not here concerned with the powers given in the Clause as such. It is, of course, perfectly true that our ancestors would have been very surprised at this Clause, and would have been very surprised at the amount of power given to a Minister in the sphere of taxation. It is certainly true that it is a very far cry from the days of our predecessors, when Mr. Gibson Bowles brought an action against the Bank of England which led to the passing of the Provisional Collection of Taxes Act, 1913. The point is that the power is given by the Clause as it stands, and that power will still be there even if the Amendment were passed. I think that it is a pity, in principle, that this amount of fiscal control of the economy is required. I could not pretend to claim it as a great triumph for Conservative financial and economic policy in the past decade that there has been this measure of retreat for the proclaimed objective of control by monetary measures in the market back in the direction of fiscal measures, which were the main patent and product of the Administration of right hon. and hon. Gentlemen opposite.

Mr. H. Wilson: We can debate this point at another time, but even the right hon. and learned Gentleman will agree that if we did rely more on fiscal and


physical controls than the present Government, we never sought the fiscal controls comparable to those which the Chancellor gets in this Clause, which he will have immediately if the Amendment is rejected.

Sir D. Walker-Smith: The right hon. Gentleman has specified two forms of control, but there are three possible ways of guiding the economy—monetary measures, fiscal measures and the actual physical controls. Right hon. Gentlemen opposite had a combination of the last two, but my right hon. and learned Friend is seeking to rely on the first two. My only measure of complaint about that is that the Government are shifting the emphasis away from the first to the second, while, thank heaven, still resisting any temptation to follow the example of right hon. Gentlemen opposite in the third possible sphere of actual physical controls.

Mr. Charles Loughlin: There is a possibility.

Sir D. Walker-Smith: I think that I would be out of order if I were to pursue that point.

Mr. Speaker: It may help the right hon. and learned Gentleman and the House if I were to say now that physical controls are wholly out of order on this Amendment.

Sir D. Walker-Smith: I am very grateful to you, Mr. Speaker, for giving that authoritative endorsement to the proposition which, with due diffidence, I was tentatively putting to the hon. Gentleman opposite.
We are here on the narrower point of the timing. There is a Parliamentary control, as the right hon. Member for Huyton well knows, in respect of the use of this regulator, because under the provisions of the Third Schedule, there must be an affirmative Resolution within 28 days. If the right hon. Gentleman thinks that it is economically wrong, which was his first point, he has his Parliamentary opportunity of making the point in the debate, and if the House accepts his view, the regulator will not come into force at all. He seeks to add this three months' injunction against the making of the Order, but, surely, the whole case for this regulator, and the whole efficacy

of its operation, depends upon the pinpoint precision of its timing.
I thought that we were agreed about this—that we can only bring these regulators usefully into force if we were able to time the operation to a nicety, having regard to the current economic state of the nation. If we do not get the timing right, we shall always be in danger of reinforcing a new tendency which is starting, but which has not yet manifested itself above the surface, instead of counteracting the inflationary tendency which is going on. If it be right that the timing is of the essence, surely it would be very foolish to start the use of this regulator with an artificial restriction placed upon the timing of its operation.
The case put forward by the right hon. Gentleman, as I understand it, is that he agrees that there can be no question of bad faith on the part of the Chancellor of the Exchequer, but he says that my right hon. and learned Friend may have miscalculated. If he has miscalculated, the right hon. Gentleman says that he should not be allowed to put the economy of the country right by using this economic regulator within three months, but that he should be forced to bring in a new Finance Bill in the same way as in 1955.

Mr. H. Wilson: The right hon. and learned Gentleman must not misrepresent what I said. I am saying that for this year only he should not be able to correct the miscalculation. We still have to complete the Report stage of the Bill, and if the right hon. and learned Gentleman had already decided that he had made a miscalculation, it would be perfectly open to him to try to correct that miscalculation with the appropriate Ways and Means Resolution to put it right, when we can still debate it during the Session. If he thinks that the Tobacco Duty or Beer Duty should go up, there is nothing to stop the right hon. and learned Gentleman, on Report, from making that proposition and the House debating it.

Sir D. Walker-Smith: The House has the opportunity of debating, in accordance with the Third Schedule, the Resolution which it requires in the context of this economic regulator. If it is defeated, the regulator will not come into effect.

Mr. Wilson: The right hon. and learned Gentleman must understand that the Chancellor imposes a regulator by a stroke of the pen. Perhaps the House will not be sitting at the time; perhaps it will. From the moment that the regulator comes into effect, taxes go up. All that we can do afterwards is to reject what the Chancellor has done. It is quite unthinkable that the Chancellor will come along to the House and give 21 or 28 days' notice to Parliament that he intends to put up the Purchase Tax or Tobacco Duty, when we have given him the power to do it. The shops will be stripped. The Chancellor would have to seek that power, and he would have to have it ratified afterwards. This is quite different from the normal Budget procedure, which I think he ought to use now, if he thinks it is necessary.

Sir D. Walker-Smith: This is a procedure specifically designed to produce an effective correction of the trend in the economy. What the right hon. Gentleman was saying, stripped of all the elegant phraseology with which he made his point, is that if the Chancellor has miscalculated he ought to pay the penalty for that miscalculation by having to come back to the House with the full Finance Bill procedure. What I say is that what we have to look at is not the past record of the Chancellor, although I take a much more favourable view of that than the right hon. Gentleman does, but the current economic state of the nation.
It would be quite wrong to deny a speedy power, if that is what the situation demands, merely for the sake of imposing upon the Chancellor, by way of penance and penalty, a more protracted procedure.

Mr. Jay: The right hon. and learned Gentleman has still not seen the point. If it is the state of the nation about which he is worried, he can meet that by amending the Bill in the normal way. The Chancellor has made up his mind now.

Sir D. Walker-Smith: I do not know whether the Chancellor has made up his mind or not. I am looking ahead to the possibility that at some time within the proposed embargo period it might be necessary to take this course, and to take it quickly. That is the situation with which the economic regulator is intended

to deal. It would be wrong art the start of its career to cripple it with these artificial restrictions on its operation in the very feature which was put into it to enable it to work with the best advantage—that is, a speedy procedure.
I think that the right hon. Member for Huyton is quite wrong to seek to impose this artificial restriction on the procedure by way of punishing the Chancellor of the Exchequer rather than promoting the well-being of the economy. I therefore hope that my right hon. and learned Friend will resist this attempt to undermine to that extent the value of this economic regulator and that the House will reject the Amendment.

Mr. Hale: The right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) began by saying that the speech of my right hon. Friend the Member for Huyton (Mr. H. Wilson) had occupied some time. He was concerned with an extremely important point. The right hon. and learned Gentleman repeated his own point four or five times without being nearly as lucid as we normally expect him to be. He is a distinguished member of his profession, and so is the Chancellor of the Exchequer. Both of them have had to study constitutional law. We are here concerned with a matter of highly constitutional importance.
I have neither the Parliamentary right nor the material justification to call myself learned, but I recall that in the days when I had to study constitutional law I was given a book by, I think, Professor Marriott, which particularly defined the things which Parliament could not do. By the time that I received the book Parliament had done most of them. It had prolonged its own life and had passed statutes which, while we had the right to repeal them, we had lost the power to enforce repeal, such as in the case of the Statute of Westminster.
The right hon. and learned Member for Hertfordshire, East referred to Mr. Gibson Bowles. He might well have also referred to Mr. Dunning, whose famous motion was that:
The power of the Crown has increased, is increasing and ought to be diminished.
The power of the Crown is vested in the Cabinet, but the power of the individual members of the Government Front Bench is increasing, has increased and


certainly should, in some respects, be diminished.
On this genuine constitutional issue the right hon. and learned Member frankly did not face whether any Parliament is justified in tying its own hands and the hands of any putative successive Parliament. I appreciate that, every time we pass delegated legislation, to an extent we entrust Parliamentary powers to a statutorily authorised procedure which limits powers of criticism and debate. But, as my right hon. Friend the Member for Huyton said, the power of taxation is the highest and most arbitrary power which Parliament possesses in relation to the great mass of the community. It is not one that we should voluntarily limit if we can help it.
4.15 p.m.
The right hon. and learned Gentleman failed to cover two points. He said that the essence of these two proposed measures, the payroll tax and the fluctuating Purchase Tax, is that one must pinpoint the date. This was the point of the Chancellor of the Exchequer when he introduced the Budget. He said, "The situation may have so materially altered before I am due to introduce my next Budget in April that I feel it desirable that I should have these two measures of control and should be able to apply them at will".
But my right hon. Friend's proposal is directed to a specific point. In many ways the essence of it is directed to the first few days after the Bill is passed while Parliament is sitting. I do not know what procedure the Chancellor would adopt if the House were not sitting. Presumably, it would have to be recalled. Presumably, the 28 days would not run through the Recess. Parliament would have to be summoned. I do not suppose that the Chancellor would be anxious to do that unless there were a new and even more serious financial emergency than that which has developed in the last few weeks.
The result is that, in essence, we are discussing whether the Chancellor has virtually made up his mind now and is to have power to adopt this procedure without further amendment, restriction or detailed discussion, but merely on a general discussion which does not permit amendment and which is terminated by the issue of a three-line Whip. That is

the point. Do not let us under-estimate the constitutional importance of it.
I do not intend to refer to the payroll tax in detail, but merely to make a general point about it. It may or it may not be used. A great number of points have been made to the Chancellor of the Exchequer about the necessity of various exemptions, and so on. It was said that this tax could bring the gravest possible hardship to the employees who would have the least opportunity of finding new employment. It might mean the dismissal of disabled persons and of elderly persons. If any reductions in staffs were made, it would almost inevitably apply, in the first instance, to people to whom it was not intended to apply.
I do not wish to misquote the Chancellor of the Exchequer, but I think that he said that he would consider the points seriously and fairly and that he would bear them in mind. But we shall have no chance of raising them again. We have no power of amendment. Ought we really to do this? Have we created a precedent to limit rather than expand our rights? Have we created a precedent so that a less honourable Chancellor of the Exchequer, with a large majority behind him, may introduce what I may call a general Budget? This is not a party matter. Future Budgets may be presented from my side of the House or from the benches opposite.
The right hon. and learned Member for Hertfordshire, East referred to some things in which my right hon. Friend the Member for Huyton and I believe. This would be a very convenient procedure for us to use. While I hope that we should not use it, if these powers are accorded by the Lower House in the Division Lobby it would be a temptation to any Chancellor of the Exchequer to say, "I will introduce a general Budget and will give myself powers under Statutory Instrument to introduce all the controls that I need as I think them necessary." This would abrogate the powers of this House to an extent to which they have not been abrogated in the centuries which have elapsed since Mr. Dunning moved his motion.

Sir D. Walker-Smith: It would not be possible to do it for physical control within the ambit—

Mr. Speaker: I do not think that we can have reference to physical controls in this debate. With respect to the hon. Member for Oldham, West (Mr. Hale), the distinction between abrogating power and not doing so in this context is whether we reduce the abrogation by three months.

Mr. Hale: I am obliged, Mr. Speaker. I am trying to pursue the point about the constitutional importance of that three months' period. The House may well think that, whether it likes this particular measure or not, there may be reason for a Chancellor of the Exchequer to say, in a fluctuating economic system, such as ours is today, "I need power to take some action, whether it be wise or not."
We are not discussing the wisdom of the proposal; we are discussing its execution. A Chancellor might say that, arid the House might agree with him. We are saying that the Chancellor should not present his Budget in April with the intention of altering its provisions. I do not impute to the right hon. and learned Gentleman any such intention in April, but I impute to him the possibility of that intention now, and the intention of saying, "The moment the Budget is passed; the moment another place has passed the Bill and Her Majesty has given it her Royal Assent, I may seek to tell the House that new circumstances have arisen and that I shall, therefore, exercise the power to tax the country under the delegation given to me in the Budget, in great excess of the figures I then gave"—the Chancellor would then have been, intentionally or not at the time, rendering a fraudulent Budget and a dishonest statement—"I shall invalidate the figures that I presented to the House as the basis of the Budget".
That is why the House should think very long before rejecting my right hon. Friend's Amendment and imposing upon the Chancellor a restriction of high constitutional importance.

Sir Alexander Spearman: I want to revert briefly to the more practical arguments put forward by the right hon. Member for Huyton (Mr. H. Wilson). As I understood it, the gist of his speech was that the Chancellor had made a miscalculation. I do not accept that there was any miscalculation. When our economy is being run at the

pace it is today, any checking of the pace in July need not necessarily have appeared advisable in April. There are only two alternatives to these checks at short notice—either to revert to the speed of the economy before the war, when we had over 2 million unemployed, when there is no need to use the brakes sharply, any more than when one is driving a car at 20 miles an hour, or to accept inflation.
When one is running at 100 miles an hour, two things can be done. One is to do what was done between 1945 and 1951, namely, to run without quick checks, and with an unregulated economy. At that time we ran into quicker rises in prices than we have ever had in this country, and into devaluation and the disastrous consequences of 1947, leading finally to the retreat in 1951.
The country as a whole is intent in avoiding the two evils of mass unemployment and violent inflation. Inflation was not completely disastrous in the days when the Labour Party was in office, because the whole of the Western world was in a state of inflation. That state of the world does not exist today.
The country would prefer to avoid the evils of unemployment and inflation, and to choose the infinitely lesser evil—and I do not deny that it is an evil—of varying the pace of the economy at short notice in order to obtain the combination of high employment and stability. For that reason, I hope that my right hon. and learned Friend will resist the Amendment.

Mr. John Diamond: The point about the three months' period touches directly the constitutional practice of this House, because we are here to agree to give the Government the Powers they need to tax the subjects. This procedure starts off with the Chancellor's coming forward and giving us his views as to the likely outcome of the following twelve months—as to what ought to be received and what ought to be paid out, and what he requires as a balance to keep the economy in check. The whole of our discussion is based upon the fundamental question whether we regard as reasonable his ideas of a correct balance between what is coming in and what is going out.
The House has accepted it as reasonable, and if the Chancellor now has


something different in mind he is attempting to ride two opposing horses at the same time, the first being his Budget, which is being clothed by the provisions of the Finance Bill, and the other being something quite different, which would result in a different Budget, and which he has at the back of his mind. In respect of which one is it reasonable for us to give the necessary power to the Chancellor? Surely it is the one which he first thought was right. How do we define which power the Chancellor is exercising? Surely it is by laying down a period which will indicate that he could not have had any alteration in his mind at the time he presented the Budget.
This is the only purpose of putting forward a period of three months. If the Chancellor takes action after three months it shows that there was nothing in his mind at the time, and if he wanted to do it before three months it would surely not be unreasonable to suppose that he was aware of it at the time. I cannot imagine any hon. Member wishing to deny other hon. Members the right of a normal discussion on the annual Budget and Finance Bill.
As the hon. Member for Scarborough and Whitby (Sir A. Spearman) has said, in an economy which moves fast, if, in November, the Chancellor says, "In April, neither I nor my advisers foresaw these developments taking place. They were not sufficiently obvious and they have been caused by acts of other countries over which we have no control," we would accept it as an honest statement, and as being something which was not in his mind in April, when he introduced his Budget.
But we cannot accept that something which was possibly in his mind when he introduced the Budget should have been withheld from the House, because the Budget provides for certain income and the House approves the Finance Bill on the basis of that income, arising out of taxation. We are approving a Budget which specifically excludes any income arising under the two Clauses dealing with the payroll tax and the regulators. We cannot have it both ways, and neither can the Chancellor. If we approve the Budget on the basis that that income is being excluded, it follows that the Chancellor must be quite specific and say,

"On Budget day I did not anticipate that we would need the income. Therefore, I put forward a prospectus—the Budget—which I honestly and sincerely believed in, and which I thought right for the country, and which I am now inviting the House to clothe with the various Clauses of the Finance Bill."
I am grateful that this discussion is taking place, because when we were dealing with the Surtax provisions, I raised the possibility of the Chancellor's bringing in a Budget under which £83 million worth of Surtax was reduced, while, at the same time, he had at the back of his mind the idea of increasing all the straightforward taxation that the ordinary person pays when he buys petrol, oil, food or tobacco, and other goods of one kind or another. It seemed to me that if that were the situation the Chancellor would be acting most unfairly, if not dishonourably.
It would be political cowardice of an extreme kind. It would mean that the Chancellor had not the courage to tell the House that, in his view, Surtax payers should receive £83 million worth of relief, but the ordinary men and women ought to pay more for all the things they buy in the shops, and that he was producing a Budget on that basis. That would have been the honest way to do it if that was in the Chancellor's mind.
4.30 p.m.
At that point of time I said to the Chancellor and to the Economic Secretary, looking across the Floor of the Chamber, that it would be intolerable if such a situation arose, and I noticed a most unpleasant and uncomfortable phase pass over the faces of the right hon. and learned Gentleman and his hon. Friend indicating to me that the possibility of using one or other or both of these Clauses was not beyond the contemplation of the Treasury, and that was quite a month ago.
I can only repeat that it is political dishonesty, political lack of courage, and cowardice of the deepest order on the part of the Chancellor to say, "I believe it right to frame a Budget which is based on certain figures although I have other figures in mind. I believe it right to invite you to pass a Clause in the Finance Bill which gives £83 million


back to Surtax payers although it is possible, and I shall not disclose this, that others in the poorest section of the community will be called upon to pay additional taxes." I believe this to be quite wrong and that the Chancellor should make it perfectly clear that this possibility was not in his mind.
The only way in which the right hon. and learned Gentleman can make it clear is to deny himself the right to use these regulators for such a period as obviously could not have been in his mind at the time he was addressing the Committee on the Finance Bill. As my right hon. Friend the Member for Huyton (Mr. H. Wilson) has said, this cannot be dated back exclusively to Budget day on 17th April. It is up to the Chancellor, if he has changed his mind between then and now, to go through the procedure now and not deny to hon. Members the opportunity to discuss it in its full context. It is open to the right hon. and learned Gentleman to do that now.
This should date not from Budget day, but from the time that the Bill leaves the House. The Chancellor should make it clear beyond doubt, by accepting the Amendment, that at all times during discussion of the Finance Bill he had it in mind to put forward a Budget in which he believed and was asking for these powers not in variation of that Budget, but in case circumstances arose which he could not foresee when the Budget was being discussed.

Sir Henry d'Avigdor-Goldsmid: It is nearly three months since my right hon. and learned Friend the Chancellor of the Exchequer introduced the Budget. Three months will certainly have elapsed almost entirely before the Finance Bill becomes law. In those circumstances it seems to me that the purpose of the Amendment is to prevent the operation for a further three months after that date, that is, for six months after the Budget, of these proposals which, when they came up in the Budget and subsequently in the Finance Bill, were greeted with a good deal of interest and a good deal of criticism, but, on the Clause containing them, were not voted on in Committee.
It seems to me, therefore—to deal with the constitutional point raised by the

hon. Member for Oldham, West (Mr. Hale)—that if it was considered constitutionally inappropriate to have this regulator Clause, the Opposition, in their wisdom, would probably have voted against it. The Opposition did not attack it at that point and it does not seem to me appropriate that right hon. and hon. Members opposite should do so now. We had the greater part of a day's debate on the Clause. It seems to me, therefore, that at this stage it is not right to challenge its constitutional application.
We come to the question of judgment. In the Clause we have given great powers to my right hon. and learned Friend in the hope that his judgment will be exercised at the right time. All human judgment is fallible and there is no criterion for it, but human character is a different matter. Courage and integrity are qualities which we all appreciate here, and in the case of my right hon. and learned Friend they have never been impugned.
I have no doubt whatsoever that if, in his judgment, he thought it right that a regulator should be applied now, my right hon. and learned Friend would say those very words to the House. The right hon. Member for Huyton (Mr. H. Wilson) went out of his way to pay tribute to my right hon. and learned Friend's integrity in this matter and, therefore, this becomes a question of judgment. Having approved the regulator when we passed the Clause in Committee, why should it be thought inappropriate for it to be put in use?

Mr. H. Wilson: I said that the whole House recognised that the Chancellor would not have come here on Budget day with the intention then of using this regulator as soon as the Finance Bill became law without telling the Committee on Budget day, and that, therefore, if there has been any change in his position it must have been due to miscalculation and not to the withholding of information.
On the other hand, it might well be that the Chancellor is minded today to use these powers in two or three weeks' time. Obviously, it is unrealistic for the Chancellor to tell us today that he will make fundamental tax changes three weeks from now, but if he has in mind today that he wants this power for use


immediately after Third Reading, then surely the Chancellor's most honourable course today would be to move to adjourn the debate until tomorrow and take the necessary steps while we are still on Report.

Sir H. d'Avigdor-Goldsmid: But if my right hon. and learned Friend accepts the Amendment, he is effectively precluded from using his judgment and that seems to me unrealistic. The argument is familiar to us that this very powerful instrument is required because we live in a very sophisticated and difficult world. In its wisdom the House of Commons has given my right hon. and learned Friend the powers. I think that he should use them when he thinks fit to do so. Knowing him, I think that at the moment he thinks fit he will do so, and no fear of all-night sittings and other nuisances that go with Parliamentary life would prevent his putting them into operation on the very day that he thought it fit.

Mr. Ede: I have listened with growing apprehension to speeches from hon. and right hon. Members opposite. I do not claim to be a great fiscal expert. I have managed with great difficulty to pay 20s. in the £ all my life without the assistance of political economists, and I still believe in the doctrine laid down by Mr. Micawber on how to attain a contented mind. Here we have one ex-Minister of the Crown and two hon. Members who are recognised in the House as political economists of some practical rather than theoretical standing.

Mr. Nabarro: Who are they?

Mr. Ede: The hon. Member for Kidderminster (Mr. Nabarro) was not in the Chamber when I was listening to the hon. Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) and, therefore. I was able to listen to him undisturbed.

Mr. Nabarro: All I said, sotto voce, was, Who are they?"

Mr. Ede: It is impossible for the hon. Member for Kidderminster to speak sotto voce according to the standards that apply to ordinary humanity.
Since the beginning of this year I have followed with some apprehension the criticisms made in this country and

abroad of the financial trend in out economy—and it is not merely what happens in this country, but the opinions held abroad which give me the most cause for concern. After listening to those three speeches, my apprehensions have been considerably increased, because they were delivered in the tone of voice which indicates that they regard the possession by the Chancellor of the power which he seeks in the Bill as of such immediate application that there will be no need for Parliament to be recalled.

Sir A. Spearman: If the right hon. Gentleman is putting any weight on what I said, I would explain that I said that if the economy is run at its present speed, with only just over 1 per cent. unemployment, then, however strong the position, the Chancellor must always be ready to vary his course at short notice.

Mr. Ede: The hon. Member only confirms my fears and reinforces the line of argument which I am trying to advance.
We are confined to the question of three months. From some date towards the end of this month, or possibly the first week of August, the Bill will become law, and if it is passed in its present form the right hon. and learned Gentleman from that moment will be able to give notice that he will apply one or other of the regulators, or both, and then, within 28 days, the House must confirm his action. There sits the right hon. Gentleman, the Patronage Secretary, who will determine that the Chancellor will get his way when he puts the matter to the House, and I cannot see the Patronage Secretary resigning on this issue because he does not like to enforce on the House a dictum of the Chancellor.
We ask that this power shall not be available until the end of October or November, when one expects that the House will be in session, about to meet or about to be recalled. What the right hon. Gentleman and two hon. Gentlemen opposite said confirms my view that trouble is so close that the Amendment is an intelligent anticipation of probable events. In view of the three speeches which we have heard today, and which will be heard far outside this country as an indication of what responsible


opinion is on that side of the House, I think that from a constitutional point of view and to retain the power of the purse it is desirable that the Amendment should be accepted.

4.45 p.m.

Mr. William Warbey: Some of us on this side of the House have opposed the Clause all through and for us it is natural to support the Amendment, which postpones the evil day.
If the Chancellor resists the Amendment then he will make it clear that he contemplates using the regulator some time within the next month, because by accepting an Amendment to the Schedule he has effectively debarred himself from using it while the House is in Recess. He can arrange for the House to be recalled and to sit for 21 or 28 days between laying the Order and passing an affirmative Resolution, but I imagine that he does not contemplate going through that procedure and therefore he must wait until the end of October before introducing a regulator or he must do it before the House rises at the beginning of August. Unless he indicates that he will accept the Amendment, that is probably his intention. It is clear from what he said in discussing the regulator and the pay roll tax that this is the regulator which he is most likely to use in view of the considerable opposition to the other.
My right hon. Friend the Member for Huyton (Mr. H. Wilson) was not willing to attribute to the Chancellor the degree of political cowardice which my hon. Friend the Member for Gloucester (Mr. Diamond) attributed to him, but the Chancellor certainly takes his choice: it is one or the other. Either when he introduced the Budget on 17th April, less than three months ago, he grossly miscalculated the probable development of the economy, or else he was then unwilling to disclose to the House and the country his intention to raise considerable additional sums by indirect taxation while at the same time handing out very large rebates as concessions to the Surtax payers.
When the Chancellor says that the purpose of the regulator is to mop up surplus purchasing power, one must ask whose purchasing power it is intended to mop up. This is the vital question which

affects the whole issue of the distribution of wealth in this country. When the Chancellor proposes to increase the spending power of 350,000 people by no less than £83 milllion and at the same time to decrease the spending power of the masses of the people by £230 million. it is clear that the Conservative Party are fully directed towards the policy of reversing the redistribution of incomes in favour of the masses which the Labour Government pursued.
That is my main objection to this regulator and why its operation should be postponed as long as possible. If we are to move towards a more just society and not have the kind of social justice which the President of the Board or Trade and other Members of the Tory Party advocate—namely, a separate form of social justice for the rich from than of the poor; and if we are to have a genuine social justice in this country, we must move away from raising revenue by indirect taxation towards the introduction of more progressive forms of taxation bearing on those who can most easily carry the burden. I urge the Chancellor to make clear to the House on this occasion what is his motive in seeking to get this Clause and in seeking—

Mr. Deputy-Speaker (Major Sir William Anstruther-Gray): The hon. Member is addressing his remarks much wider than the Amendment which is now under discussion.

Mr. Warbey: I was about to say at that moment, Mr. Deputy-Speaker—and in seeking to apply that power immediately upon the termination of the discussion of the Finance Bill. If the Chancellor resists this Amendment, as we have every reason to fear he proposes to do, it seems to me an extraordinary state of affairs that we can have a Government which is quite prepared to drop the Weights and Measures (No. 1) Bill and introduce a Weights and Measures (No. 2) Bill.

Mr. Deputy-Speaker: I hope the hon. Member will pay attention to what I have said. The Weights and Measures Bill has nothing whatever to do with this Amendment.

Mr. Warbey: With great respect, Mr. Deputy-Speaker, I was only introducing an analogy, comparing the behaviour of


the Government in respect to this Measure with their behaviour on another Measure. I was about to suggest that if it is the Chancellor's intention to apply these fiscal measures in the very near future, the proper way to do it would be by means of a Finance (No. 2) Bill which could, if necessary, be introduced immediately this Bill is concluded and on which we could have a full discussion—

Mr. Diamond: Why not now?

Mr. Warbey: Certainly the Government might do it now, but unfortunately at the moment, by the rules of order, we are precluded by having to pursue the matter in this form from discussing all the wider implications of what the Chancellor proposes to do. In fact, that is one of our objections. If he were to accept our Amendment and then introduce another Finance Bill, we should have an opportunity of considering this matter in its wider implications in relation to the economy of this country and to the burdens that are imposed on certain taxpayers and other citizens, and we should also have the opportunity of proposing Amendments to it. That is the course that I think the Chancellor ought to take if he has political courage. If he has not, then I can understand that he prefers to follow this method of attacking the standard of living of the ordinary working people of this country, not in one fell swoop, but by this insidious method of stage by stage attack through insurance contributions plus the economic regulators and the like.

Mr. Eric Fletcher: I hope that the House will allow me to intervene very briefly, because I share the deep concern which has been expressed by my right hon. and hon. Friends about this matter.
It is not only a matter of great constitutional importance, but, as my hon. Friends have pointed out, it involves the political honesty and integrity of the Chancellor. I am not concerned to examine what may have been the case in April when the Budget was introduced. There may or may not have been a case then that it was wise to look ahead to see whether circumstances might arise within 12 months which might make it necessary for the

Chancellor to ask Parliament to give him more constitutional powers. But now, at the beginning of July, we are faced with an entirely different position.
This Amendment suggests that the powers which the Chancellor is seeking in the Finance Bill should not be exercised during the next three months. The case would be exactly the same if instead of three months we substituted two months or one month. What is involved is a matter of constitutional importance and also the question of Parliamentary control. The only ground on which the Chancellor can resist these Amendments is if he has it in mind in the immediate future to give effect to the powers which this Bill will give him under Clause 8.
It has been widely and frequently stated, both in the Financial Press and the popular Press, that owing to the changes in the economic situation which have developed during the last two or three months it is the intention of the Chancellor, as soon as this Bill has been hurried through all its stages in this House, has fulfilled its perfunctory passage in another place, where it cannot be changed, and the Royal Assent has been given, immediately to avail himself of the powers under Clause 8 to impose a 10 per cent. surcharge on purchase tax and everything else, which will have the effect of raising the cost of living. Either that is the Chancellor's intention or it is not. Perhaps he will tell us when he replies, because that is the acid test.
If it is the Chancellor's intention to do that, as is widely prophesied by the financial pundits, we ought to know and have an opportunity of examining the feasibility of it. If there is a case to be made for it, let it be made so that we can at least criticise and examine it to see if it bears any relation to other provisions in the Finance Bill with regard to Surtax and so forth. But what would not be proper, what would be contrary to all constitutional procedure, and what would be the complete abrogation of Parliamentary control, would be for this House to pass this Bill knowing or thinking that the Chancellor intends immediately the Bill has become an Act to take advantage of this provision.
If after the Bill becomes law the Chancellor, as is widely assumed in the


City and overseas, intends within a few days or weeks to take advantage of this power to make this vicious, violent and serious attack upon our whole fiscal system and the level of taxation as between various classes, I think, in common with my hon. Friends—I do not want to mince my words—that the right hon. and learned Gentleman will be doing something which is completely contrary to our constitutional position and in defiance of the whole theory of Parliamentary control over taxation.
5.0 p.m.
If the Chancellor has no intention of doing any such thing, it would be quite easy for him to say so and to say that he accepts the Amendment. It would be quite easy for him to say that he would, instead of three months, accept a period of two months or even one month, or any other period. I am not debating the general question that it might be necessary in a changed economy to give the Chancellor some power of this kind to be exercised between the introduction of one Budget and another. My personal opinion is that such a question would be debatable and I should be against such a thing.
I have no confidence in the judgment of the Chancellor. I would not entrust him what that power. I do not think that this or any Parliament ought to delegate that serious responsibility and duty to any Chancellor of the Exchequer, still less to the right hon. and learned Gentleman. What I do say is that here we are considering merely the question of timing, assuming that there may be a case for some exercise of Executive power. The question imposed by this Amendment is whether, on the eve of the passing of a Finance Bill, with all its manifold changes in taxation, and after inquiry during the Committee and Report stages and the various effects and changes of the level of taxation on Surtax and Income Tax payers and the relation between direct and indirect taxation, within a short time after the passage of the Finance Bill after it had been thoroughly debated by Parliament, the Executive should have power to make sweeping changes in the balance of taxation between one class and another.
It can be argued that no Parliament should give a Chancellor the power to do such a thing immediately after the passing of a Finance Bill. Surely there must be some interval of time during which the provisions of a finance Measure as enacted by Parliament are sacrosanct and represent the will of Parliament and the people about the way in which taxation should be raised, and what tax burdens should be imposed on one class and another in the community. There should be some interval of time—I am not arguing how long, two months, three months or four months—within which what Parliament has resolved with regard to taxation should be the law of the land. Surely we are not intending to say that immediately the Finance Bill becomes law that the Chancellor by his own ipse dixit shall be able to change it all.
The right hon. and learned Gentleman looks very gloomy. He is sullen and silent, and I can understand that. But we must know what is his attitude of mind. Is the Chancellor intending to resist this Amendment in order that he may claim the right to override the will of Parliament as soon as that will is expressed in the form of a Finance Act? If not, I do not know on what basis he can resist this Amendment. If that be the intention of the Chancellor, it is flagrantly dishonest for him to ask us to pass a Bill on a certain basis. The Chancellor must know whether that is his intention. The Press is assuming that it is. If it is not, he ought to tell the House so frankly. If it is, I think it dishonest, and not merely that, but a flagrant invasion of the rights of Parliament.
If that be the Chancellor's intention he should tell the House frankly so that now, before we pass the Finance Bill, we can consider whether it is reasonable and whether any consequent changes are required. I am opposed on constitutional grounds to granting this power to the Chancellor at all. If there is a case to be made, I think it absolutely monstrous that such powers should be granted in circumstances in which they may be exercised immediately after the Finance Bill has been enacted without the Chancellor disclosing that to be his intention, and in circumstances in which Parliament would be left with the alternative of accepting or rejecting an


affirmative Resolution and without any opportunity of debating the consequences, the implications and the changes which ought to be made.
I do not want to mince my words. I think this one of the most serious and grave Amendments to the Finance Bill that we have debated. I hope that when he replies the Chancellor will give us a clear, frank and honest answer to the questions raised by my right hon. and hon. Friends.

Mr. Frank Bowles: Following the speeches of my right hon. and hon. Friends, I think that the Chancellor of the Exchequer would do himself a great deal of credit, and would do a great deal of good to the country's credit, by accepting the Amendment. It would show that he was not frightened of the truth of the prophecies of such a dismal character which have been made. So I hope that the right hon. and learned Gentleman will accept the Amendment. I notice from the Third Schedule that the Order shall cease to have effect after twenty-eight days after the day on which it is made. That seems to indicate that an Order could be enforced for twenty-seven calendar days, not Parliamentary sitting days, which is better than sometimes happens in the case of Parliamentary Measures. But in those twenty-seven days a lot of things might be done which would have a tremendous effect on the economy.
How long does the Chancellor anticipate that a debate on an Order would take? Usually such debates last from 10 p.m. until 11.30 p.m., and then, if Mr. Speaker thinks that the debate has not been adequate, he can adjourn the House without Question being put. In other words, it would be possible for the House to have debate for an hour and a half and then for Mr. Speaker, because he did not think that the Question had been adequately discussed, to adjourn the debate without the Question being put. May we have an assurance that at least a whole day, or possibly two days, will be given to debating any Order which the right hon. and learned Gentleman may lay before the House in the event of it being necessary to recall Parliament?

The Chancellor of the Exchequer (Mr. Selwyn Lloyd): In this debate there

have been references to the merits of these two regulators. I am conscious of the fact that there are differing opinions about them, and, indeed, between them, as to their merits. When I introduced my Budget, there were some pleasant things said about a new approach and new methods and how good that was. But I knew all the time that any regulator which was introduced would be exceedingly unpopular and I had no illusions about that. If these regulators are used they will be exceedingly unpopular, and I have no doubt that a good deal of "hay" will be made by the hon. Members opposite in their attempts to stir up popular opinion against them. Bat the test of political cowardice or courage is whether one does unpopular things in the national interest if one thinks it right to do so.
I do not attempt to deny in any way the constitutional importance of the point made by the hon. Member for Oldham, West (Mr. Hale). I have never underestimated it. I consider this to be a constitutional innovation of great importance, and because of that I have tried to deal with it in a reasonable manner. That is why I accepted the proposition that it should not be sitting days but calendar days, and later I am putting forward an Amendment to reduce the period from twenty-eight days to twenty-one days. In putting forward this proposition, I said that I thought it was such an exceptional power that each Chancellor should have it renewed year by year. It is something which should not be for him in perpetuity, so to speak, but should be positively renewed each year. I have no illusions about that. I think it is a matter of great constitutional importance, and I have tried to meet that point in the way I have suggested.
With regard to this point put by the hon. Member for Nuneaton (Mr. Bowles), if I may say so, I cannot conceive of this matter being dealt with in one and a half hours at the end of a parliamentary day. Though it is not for me to say how many days would be given to a decision of this magnitude, obviously it would involve a substantial economic debate. I cannot conceive of its being run through at the end of a day.
I am not sure that I fully understand one part of the argument in favour of


the Amendment. The Opposition did not vote against Regulator No. 1. Indeed, in dealing with regulators generally and the constitutional aspect of action between Budgets, the right hon. Gentleman the Leader of the Opposition himself said:
In my opinion, it would be foolish to dismiss this idea out of hand as just another interference. Certainly, we would not oppose in principle giving a power to act between Budgets. There is something slightly absurd about waiting each year for a Budget before one can take action in the fiscal field."—[OFFICIAL REPORT, 17th April, 1961; Vol. 638, c. 842.]
The right hon. Gentleman went on to say that any particular action proposed would have to be scrutinised very carefully, but it seemed to me that he approved the principle of taking action between Budgets.
Then again, the right hon. Gentleman the Member for Battersea, North (Mr. Jay), on 1st June, said:
In general, we on this side are not opposed to using taxation as a planning instrument which, I gather from the Chancellor's pronouncements up to date, is the purpose of this and the other economic regulator. Indeed, in the 1948 Finance Act the Labour Government took a similar power. I suspect that the Chancellor opposed it at that time"—
I do not remember now whether I did or not—
but we took the power to vary Purchase Tax from time to time by Order in the fashion now suggested."—[OFFICIAL REPORT, 1st June, 1961; Vol. 641, c. 512.]
Of course, that procedure was subject to the rule about sitting days, so, on 1st August, the Government, acting with that power, could technically increase Purchase Tax to the extent of about £900 million and Parliament would not have the right to say anything about it until November.

Mr. Jay: That power was intended to be used for Purchase Tax, and it has been used only to make minor changes or to correct anomalies. That is very different from the changes envisaged here, which will involve hundreds of millions of pounds.

Mr. Lloyd: The right hon. Gentleman himself drew an analogy between what the Labour Government did in 1948 and these regulators which I am proposing. It seemed to me quite clear that he was envisaging what was done

in 1948 as being a means of economic regulation. I do not understand why, if it is right to have this power, a time limit should be put upon it. If it is the correct action to take, why is it wrong to do it in four weeks, or eight weeks, or ten weeks, but right to do it in 14 weeks? If it is right for the weapon to be used at a certain time in the national interest, then it should be used.
The right hon. Member for Huyton (Mr. H. Wilson) referred to miscalculations which he said I had made. He did not accuse me of bad faith by being determined already, when I introduced my Budget, to put this thing into operation in July, but he did say that perhaps I had miscalculated. Anyone who thinks that he can correctly calculate in this world what is to happen is thinking too much of himself.
Though he criticised my state of mind, the right hon. Gentleman acquitted me of bad faith in presenting the Budget. He asked what my views were now. My anxieties about the situation are very clear. I stated them at some length in my speech at the Association of British Chambers of Commerce on 22nd June, which was widely reported. Anyone looking at the situation in the world must feel a measure of anxiety. There are possibilities for corrective action in the monetary and other fields, but I have taken no specific decision.
A lot goes on from day to day, and I shall take the decisions which I think to be right in the interests of the country, and shall seek to implement them at the time when I think it is in the country's interests to do so. If this power is the right thing to have, as I believe it is, I ask the House to support me in the view that if it is right to have it, then it is wrong to limit it in the sense suggested inn this Amendment, which I ask the House to reject.

5.15 p.m.

Mr. H. Wilson: Before the right hon. and learned Gentleman sits down. may I ask him whether, as he has made important pronouncements outside this House, he intends to make an announcement before the Recess? It is very relevant to our attitude towards the Amendment.

Mr. Lloyd: I cannot answer that question today. I should be very surprised if the House rose for the Recess


without a statement on our economic position. Beyond that I cannot go.

Mr. Wilson: Before the right hon. and learned Gentleman completes the process of sitting down again, may I ask him one other question? He rejects the suggestion that there should be a ban on the use of this power for three months after the Bill becomes law. Would he be prepared, so as to satisfy the whole House about the constitutional aspects, to accept a closed period of one month after the Bill becomes law, so that we are not left with the suspicion that he may take action, perhaps within a few days, of the Report stage? In other words, if we were to offer to withdraw this Amendment, would he then propose a manuscript Amendment to substitute a period of one month, or else give a clear assurance that he would not use the power within one month of the Royal Assent?

Mr. Lloyd: I cannot give that assurance, and the right hon. Gentleman would not dream of doing such a thing if he were in my place. If, in the national interest, I have to take certain action, I must have freedom of manœuvre to take it as soon as it is necessary. Such a proposal is contrary to the national interest and it is an unreasonable request to make.

Mr. Wilson: As the right hon. and learned Gentleman has not quite sat down, may I put a further question? We are now on the Report stage of the Bill. Is he saying that he has still not made up his mind about these regulators? If he has not, then it is his duty to bring in amendments. If the right hon. and learned Gentleman has not yet taken a decision, but is confident that he will have to take one in future, why will he not accept a closed period?

Mr. Lloyd: I have made no specific decisions. I have said that we are passing through anxious days. There are many possibilities open to me—a whole range of things which I do not think it wise for me to mention. When the Bill receives the Royal Assent there will be other possibilities. I have made no specific decisions about the instruments to use to deal with the situation.

Mr. Fletcher: In the interests of Parliamentary decency, would the Chancellor agree that, if he had made up his mind

to use these regulators within one month of the passing of the Bill, it would be his duty to inform the House of Commons now?

Mr. Lloyd: The hon. Gentleman talks of Parliamentary decency. He has not put all his remarks quite as courteously today as he usually does. If I had made up my mind on the introduction of these regulators at a particular rate, or to introduce them at all, it would be my duty to say so. I have not taken those decisions.

Mr. G. R. Mitchison: Fishing is great fun, but this is a constitutional question, and an important one. It arises, as I see it, on the terms of the Amendment. The Amendment proposes a period of three months, but I do not think that anyone would insist on a specific period of that kind, and if the right hon. and learned Gentleman were able to give us an assurance about the time I, at any rate, and, I think my right hon. and hon. Friends, would accept that in lieu of pressing the Amendment.
The point is this. The right hon. and learned Gentleman considers it his duty to take courageous action when he thinks it right and in the national interest. That is one side of taxation. There is no doubt that if there was no democratic responsibility for taxation it would in many ways be an easier thing to do. Taxation in a country such as ours is always a compromise between the absolute efficiency to which the Executive is tempted and the requirements of democracy, which cause us to profess at the beginning of a Bill such as this that we
have freely and voluntarily resolved to give and grant unto Your Majesty the several duties hereinafter mentioned".
It was for that latter aspect of taxation that in the seventeenth century there was civil war in this country and men fought to defend the representative nature of taxation against the efficiency which was no doubt inherrent in ship money. That is the sort of question which arises here. It depends, in the circumstances of this case, on the reasonable length of the Chancellor's foresight. It would be wrong for the Chancellor, having decided that the situation required the use of one of these weapons, to elect to do it by an Order for some minor administrative or, to use a wider expression, minor executive convenience.
A sacrifice ought to be made in that direction. If it is intended to use these powers within a foreseeable period, a reasonably short period, they ought to be put in the Bill. The House is still seized of the Bill. We have not yet parted with it. It is open to us to pass additional Ways and Means Resolutions if they are required. It is open to the Government to introduce Amendments. It would be right to do so, even if it were inconvenient, should it be the case that the right hon. and learned Gentleman intends within the limits of his foresight to use the powers he is taking.
On the other hand, I can see the case when was put by my right hon. Friend the Leader of the Opposition for saying that there is a long period between Budgets and that in the circumstances of the world and of this country as it is today it may be right and proper to provide for action to be taken on emergencies or in circumstances which arise in the not immediately foreseeable future. I understand that. I understand, also, the need for minor administrative changes in such a tax as Purchase Tax and for making provision for them, as was done in 1948. Technically, it is true that those powers could have been more widely used, but they never have been. That is a totally different matter and a different intention from what we have to deal with today.
It used to be said that equity was the length of the Lord Chancellor's foot. What we are considering today is how far the Chancellor of the Exchequer is justified in taking powers, which he may well need, in a form which will enable him to make up his mind not in detail now, or deliberately to refrain from making up his mind, and yet in truth and in substance intend to use the powers and prefer to have them in the shape of an Order-making power rather than in the Finance Bill.
That is a balance between the necessary relation between taxation and representation, on the one hand, and sheer administrative convenience in a rather complicated world, on the other. We come to the old balance between the rights of this House to control taxation and the convenience of the Executive in dealing with taxation. The two things do not always coincide. While the Chancellor is fully entitled to say, if he

chooses, "In present circumstances my foresight does not run to three months" he should at least have given an indication that what he is intending to do is to provide for an emergency or a possible emergency between Budgets and not merely take an Order-making power instead of a legislative power, which is a quite different matter which can be much more fully discussed and considered in the House than even the two or three days which the right hon. and learned Gentleman was prepared to contemplate might be allowed for the discussion of an Order would permit. An Order, in the nature of the case, cannot be amended and dealt with in the same detailed way.
This is a question of the right hon. and learned Gentleman's courage in doing the right thing, but he must remember that his courage is to be exercised in two directions. One is what he thinks is right for the nation. We accept the need to do that. The other is the imperative need of this country to maintain the principle of no taxation without representation and the consequent principle that in imposing taxation due regard must be had to the wishes and power of what is, after all for these purposes the only representative assembly in the country.

Mr. Selwyn Lloyd: With the leave of the House, I should like to make a few remarks. Two quite different points are being mixed up here. The first is the constitutional issue. The Opposition say that they do not like monetary controls. Earlier in the year I suggested that we needed additional controls. I put forward two suggestions which I admitted straight away were rather blunt instruments. One was a flat percentage increase over almost the whole range of taxation on personal consumption. It is a blunt instrument, because it is a flat rate. There is not to be any distinction between commodity and commodity. It is to be a flat-rate increase.
Against that proposition the Opposition did not divide. They did not divide against the proposal that the Government should use such a regulator. The important constitutional point is that in using a blunt instrument of this sort one should not ride roughshod over the rights of the House. The Government have shown their intention of not doing that by saying that we will come within


21 days to get the approval of the House. That is the constitutional point.
It is now suggested that, it being conceded that the Chancellor of the Exchequer should have this kind of blunt instrument to use as an economic regulator, he must not use it for a fixed period after the passing of the Act which gives him power to do so. That is illogical and, indeed, foolish. It is quite out of keeping with the general argument about the use of economic regulators. The hon. and learned Member for Kettering (Mr. Mitchison) referred to an emergency. The whole point of an economic regulator is to try to avoid an emergency. If the House chooses to give the Government the power to use an economic regulator of this sort, it is very foolish to try to fetter the discretion of the Government in any way about when the regulator can be used, provided that the Government come back to the House within a reasonable time to get approval for their action.

Mr. Jay: Will the Chancellor clear up this point? What would be the legal

position if the House were to reject one of these Orders raising taxation after, say, 21 days when the increased taxation had already been collected during that period? Presumably on that day the tax rate would revert to the former level. Would the taxpayer have any right to claim back the money that he had paid?

Mr. Lloyd: I am sure that the right hon. Gentleman must have thought that out when he supported the action his own Government took in 1948. I do not know the answer to that question now. I imagine that it will be exactly the same principle as with any form of Revenue tax which is announced at the time the Budget is introduced and which may be rejected by the House.

Mr. H. Wilson: Is not that an argument for deferring the Chancellor's power to use this for three months? Will he find out what the position is?

Question put, That those words be there inserted in the Bill: —

The House divided: Ayes 178, Noes 231.

Division No. 239.
AYES
[5.29 p.m.


Ainsley, William
George, Lady MeganLloyd (Crmrthn)
Lee, Frederick (Newton)


Albu, Austen
Ginsburg, David
Lee, Miss Jennie (Cannock)


Allen, Scholefield (Crewe)
Gordon Walker, Rt. Hon. P. c.
Lewis, Arthur (West Ham, N.)


Awbery, Stan
Gourlay, Harry
Lipton, Marcus


Bacon, Miss Alice
Greenwood, Anthony
Loughlin, Charles


Baxter, William (Stirlingshire, W.)
Grey, Charles
Mabon, Dr. J. Dickson


Bence, Cyril
Griffiths, Rt. Hon. James (Llanelly)
McCann, John


Benson, Sir George
Griffiths, W. (Exchange)
MacColl, James


Blyton, William
Grimond, J.
McInnes, James


Boardman, H.
Hale, Leslie (Oldham, W.)
McKay, John (Wallsend)


Bowden, Herbert W. (Leics, S.W.)
Hall, Rt. Hn. Glenvil (Colne Valley)
McLeavy, Frank


Bowles, Frank
Hamilton, William (West Fife)
MacPherson, Malcolm (Stirling)


Boyden, James
Hart, Mrs. Judith
Mallalieu, J.P.W.(Huddersfield, E.)


Braddock, Mrs. E. M.
Hayman, F. H.
Manuel, A. C.


Brockway, A. Fenner
Healey, Denis
Mapp, Charles


Broughton, Dr. A. D. D.
Hilton, A. V.
Marsh, Richard


Brown, Alan (Tottenham)
Holman, Percy
Mayhew, Christopher


Brown, nt. Hon. George (Belper)
Holt, Arthur
Mellish, R. J.


Butler, Herbert (Hackney, C.)
Houghton, Douglas
Mendelson, J. J.


Butler, Mrs. Joyce (Wood Green)
Howell, Charles A. (Perry Barr)
Milne, Edward J.


Callaghan, James
Howell, Denis (Small Heath)
Mitchison, G. R.


Chetwynd, George
Hoy, James H.
Monslow, Walter


Crosland, Anthony
Hughes, Cledwyn (Anglesey)
Moody, A. S.


Cullen, Mrs. Alice
Hughes, Emrys (S. Ayrshire)
Mort, D. L.


Davies, G. Elfed (Rhondda, E.)
Hunter, A. E.
Moyle, Arthur


Davies, Harold (Leek)
Hynd, H. (Accrington)
Neal, Harold


de Freitas, Geoffrey
Hynd, John (Attercliffe)
Noel-Baker, Francis (Swindon)


Delargy, Hugh
Irvine, A. J. (Edge Hill)
Oram, A. E.


Diamond, John
Irving, Sydney (Dartford)
Owen, Will


Dodds, Norman
Jay, Rt. Hon. Douglas
Pannell, Charles (Leeds, W.)


Dugdale, Rt. Hon. John
Johnson, Carol (Lewisham, S.)
Parkin, B. T.


Ede, Rt. Hon. C.
Jones, Rt. Hn. A. Creech (Wakefield)
Pavitt, Laurence


Edwards, Rt. Hon. Ness (Caerphilly)
Jones, Dan (Burnley)
Pearson, Arthur (Pontypridd)


Edwards, Walter (Stepney)
Jones, Jack (Rotherham)
Pentland, Norman


Evans, Albert
Jones, J. Idwal (Wrexham)
Popplewell, Ernest


Fitch, Alan
Jones, T. W. (Merioneth)
Prentice, R. E.


Fletcher, Eric
Kelley, Richard
Price, J. T. (Westhoughton)


Foot, Michael (Ebbw Vale)
Kenyon, Clifford
Probert, Arthur


Fraser, Thomas (Hamilton)
Key, Rt. Hon. C. W.
Randall, Harry


Gaitskell, Rt. Hon. Hugh
King, Dr. Horace
Rankin, John


Galpern, Sir Myer
Ledger, Ron
Redhead, E. C,




Roberts, Albert (Normanton)
Stones, William
Wells, William (Walsall, N.)


Roberts, Goronwy (Caernarvon)
Strachey, Rt. Hon. John
White, Mrs. Eirene


Robertson, John (Paisley)
Strauss, Rt. Hon. G. R. (Vauxhall)
Whitlock, William


Robinson, Kenneth (St. Pancras, N.)
Stross, Dr. Barnett (Stoke-on-Trent, C.)
Wilkins, W. A.


Ross, William
Swain, Thomas
Willey, Frederick


Royle, Charles (Salford, West)
Swingler, Stephen
Williams, D. J. (Neath)


Shinwell, Rt. Hon. E.
Symonds, J. B.
Williams, W. R. (Openshawe)


Short, Edward
Taylor, Bernard (Mansfield)
Williams, W. T. (Warrington)


Silverman, Julius (Aston)
Taylor, John (West Lothian)
Willis, E. G. (Edinburgh, E.)


Silverman, Sydney (Nelson)
Thompson, Dr. Alan (Dunfermline)
Wilson, Rt. Hon. Harold (Huyton)


Skeffington, Arthur
Thomson, G. M. (Dundee, E.)
Winterbottom, R. E.


Slater, Mrs. Harriet (Stoke, N.)
Thornton, Ernest
Woodburn, Rt. Hon. A.


Slater, Joseph (Sedgefield)
Thorpe, Jeremy
Woof, Robert


Small, William
Timmons, John
Yates, Victor (Ladywood)


Smith, Ellis (Stoke, S.)
Tomney, Frank
Zilliacus, K.


Snow, Julian
Wade, Donald



Sorensen, R. W.
Wainwright, Edwin
TELLERS FOR THE AYES:


Spriggs, Leslie
Warbey, William
Mr. G. H. R. Rogers and


Steele, Thomas
Watkins, Tudor
Mr. Lawson


Stewart, Michael (Fulham)
Weitzman, David





NOES


Agnew, Sir Peter
Erroll, Rt. Hon. F, J.
Leburn, Gilmour


Aitken, w. T.
Farey-Jones, F. W.
Lewis, Kenneth (Rutland)


Allason, James
Farr, John
Lindsay, Martin


Arbuthnot, John
Fell, Anthony
Litchfield, Capt. John


Atkins, Humphrey
Finlay, Graeme
Lloyd, Rt. Hon. Selwyn (Wirral)


Barber, Anthony
Fisher, Nigel
Longden, Gilbert


Barlow, Sir John
Fletcher-Cooke, Charles
Lucas-Tooth, Sir Hugh


Barter, John
Forrest, George
McAdden, Stephen


Baxter, Sir Beverley (Southgate)
Fraser, Hn. Hugh (Stafford &amp; Stone)
MacArthur, Ian


Bennett, F. M. (Torquay)
Fraser, Ian (Plymouth, Sutton)
McLaughlin, Mrs. Patricia


Berkeley, Humphry
Freeth, Denzil
Maclay, Rt. Hon. John


Bevins, Rt. Hon. Reginald
Galbraith, Hon. T. G. D.
Mclean, Sir Fitzroy (Bute &amp; N.Ayrs.)


Bidgood, John c.
Gammans, Lady
Macleod, Rt. Hn. Iain (Enfield, W.)


Biggs-Davison, John
Gardner, Edward
MacLeod, John (Ross &amp; Cromarty)


Bingham, R. M.
George, J. C. (Pollok)
McMaster, Stanley R.


Birch, Rt. Hon. Nigel
Glover, Sir Douglas
Maddan, Martin


Bishop, F. P.
Glyn, Dr. Alan (Clapham)
Maginnis, John E.


Black, Sir Cyril
Godber, J. B.
Maitland, Sir John


Bourne-Arton, A.
Goodhart, Philip
Markham, Major Sir Frank


Box, Donald
Gower, Raymond
Marshall, Douglas


Boyle, Sir Edward
Grant, Rt. Hon. William
Marten, Neil


Brewis, John
Green, Alan
Mathew, Robert (Honiton)


Brooke, Rt. Hon. Henry
Grimston, Sir Robert
Matthews, Gordon (Meriden)


Brooman-White, R.
Grosvenor, Lt.-Col. R. G.
Mawby, Ray


Bryan, Paul
Gurden, Harold
Maxwell-Hyslop, R. J.


Buck, Antony
Hall, John (Wycombe)
Maydon, Lt.-Cmdr. S.L.C.


Bullard, Denys
Hamilton, Michael (Wellingborough)
Mills, Stratton


Burden, F. A.
Harris, Frederic (Croydon, N.W.)
Montgomery, Fergus


Butler, Rt. Hn. R. A.(Saffron Walden)
Harrison, Col. Sir Harwood (Eye)
More, Jasper (Ludlow)


Campbell, Sir David (Belfast, S.)
Harvie Anderson, Miss
Morgan, William


Campbell, Gordon (Moray &amp; Nairn)
Heald, Rt. Hon. Sir Lionel
Nabarro, Gerald


Carr, Compton (Barons Court)
Heath, Rt. Hon. Edward
Nicholls, Sir Harmar


Cary, Sir Robert
Henderson, John (Cathcart)
Nicholson, Sir Godfrey


Channon, H. P. G.
Henderson-Stewart, Sir James
Noble, Michael


Chataway, Christopher
Hicks Beach, Maj. W.
Nugent, Sir Richard


Clark, Henry (Antrim, N.)
Hiley, Joseph
Oakshott, Sir Hendrie


Clark, William (Nottingham, S.)
Hill, Dr. Rt. Hon. Charles (Luton)
Osborn, John (Hallam)


Clarke, Brig. Terence (Portsmth, W.)
Hill, Mrs. Eveline (Wythenshawe)
Osborne, Sir Cyril (Louth)


Cleaver, Leonard
Hill, J. E. B. (S. Norfolk)
Page, John (Harrow, West)


Cole, Norman
Hirst, Geoffrey
Page, Graham (Crosby)


Cooper, A. E.
Hobson, John
Pannell, Norman (Kirkdale)


Cooper-Key, Sir Neill
Hocking, Philip N.
Partridge, E.


Cordeaux,, Lt.-Col. J. K.
Holland, Philip
Pearson, Frank (Clitheroe)


Cordle, John
Hollingworth, John
Peyton, John


Corfield, F. V.
Hopkins, Alan
Pickthorn, Sir Kenneth


Costain, A. P.
Hornsby-Smith, Rt. Hon. Patricia
Pilkington, Sir Richard


Courtney, Cdr. Anthony
Howard, John (Southampton, Test)
Pitman, Sir James


Craddock, Sir Beresford
Hughes-Young, Michael
Pitt, Miss Edith


Critchley, Julian
Hulbert, Sir Norman
Pott, Percivall


Cunningham, Knox
Hutchison, Michael Clark
Price, David (Eastleigh)


Curran, Charles
Iremonger, T. L.
Proudfoot, Wilfred


Currie, G. B. H.
Jackson, John
Quennell, Miss J. M.


Dalkeith, Earl of
James, David
Redmayne, Rt. Hon. Martin


d'Avigdor-Goldsmid, Sir Henry
Jenkins, Robert (Dulwich)
Rees-Davies, W. R.


de Ferranti, Basil
Johnson, Dr. Donald (Carlisle)
Renton, David


Digby, Simon Wingfield
Johnson, Eric (Blackley)
Ridley, Hon. Nicholas


Donaldson, Cmdr. C. E. M.
Johnson Smith, Geoffrey
Ridsdale, Julian


Doughty, Charles
Kaberry, Sir Donald
Roots, William


du Cann, Edward
Kershaw, Anthony
Ropner, Col. Sir Leonard


Elliot, Capt. Walter (Carshalton)
Lagden, Godfrey
Royle, Anthony (Richmond, Surray)


Elliott, R.W. (N'wcstle-upon-Tyne, N.)
Leather, E. H. C.
Russell, Ronald


Emery, Petor
Leavey, J. A.
Scott-Hopkins James







Seymour, Leslie
Teeling, William
Ward, Dame Irene


Sharples, Richard
Temple, John M.
Watkinson, Rt. Hon. Harold


Shaw, M.
Thatcher, Mrs. Margaret
Webster, David


Skeet, T. H. H.
Thomas, Leslie (Canterbury)
Wells, John (Maldstone)


Smith, Dudley (Br'ntf'rd &amp; Chiswick)
Thornton-Kemsley, Sir Colin
Whitelaw, William


Spearman, Sir Alexander
Tiley, Arthur (Bradford, W.)
Williams, Dudley (Exeter)


Speir, Rupert
Turner, Colin
Williams, Paul (Sunderland, S.)


Stevens, Geoffrey
Turton, Rt. Hon. R. H.
Wills, Sir Gerald (Bridgwater)


Stoddart-Scott, Col. Sir Malcolm
Tweedsmuir, Lady
Wilson, Geoffrey (Truro)


Storey, Sir Samuel
van Straubenzee, W. R.
Woodhouse, C. M.


Studholme, Sir Henry
Vosper, Rt. Hon. Dennis
Woodnutt, Mark


Summers, Sir Spencer (Aylesbury)
Wakefield, Edward (Derbyshire, W.)
Woollam, John


Talbot, John E.
Walder, David
Worsley, Marcus


Tapsell, Peter
Walker, Peter



Taylor, Sir Charles (Eastbourne)
Walker-Smith, Rt. Hon. Sir Derek
TELLERS FOR THE NOES:


Taylor, Edwin (Bolton, E.)
Wall, Patrick
Mr. Chichester-Clark and




Mr. Peel.

The Economic Secretary to the Treasury (Mr. Anthony Barber): I beg to move, in page 7, line 37, at the end to insert:
(10) For the purpose of section two of the Isle of Man Act, 1958 (Isle of Man share of equal duties) the amount of equal duties collected in the Isle of Man and the United Kingdom, or in the Isle of Man, shall be calculated by reference to the amount so collected in respect of such duties after giving effect to any addition or deduction provided for under this section or any corresponding provisions of the law of the Isle of Man.
Under the Isle of Man Act, 1958, the island has virtual autonomy as regards Customs and Excise duties, but has agreed in return to keep its duties on goods generally in line with the United Kingdom tariff and to share the receipts. Under the authority of Section 2 of the Isle of Man Act, 1958, the proceeds of these "equal duties", whether they happen to be collected in the island or in the United Kingdom, are treated as a common fund which is known as the Common Purse, and the share of this fund determined by the Treasury to be appropriate to goods consumed or used in the island is paid to the Government of the Isle of Man.
In accordance with this policy, the Isle of Man authorities will apply any future surcharge or rebate on United Kingdom rates of duty to the smaller duties in the island. An Act of Tynwald is being drafted to this effect. It follows from the Isle of Man's agreement to keep in line as regards surcharges and rebates that the surcharged or rebated amounts of the "equal duties" should also be paid into the common fund. That is the purpose of this Amendment.

Amendment agreed to.

Clause 12.—(SURTAX: RELIEFS FOR EARNED INCOME.)

Mr. Douglas Houghton: I beg to move, in page 8, line 24, after "individual", to insert:
whichever is the less of the following amounts, that is to say four thousand and five pounds and".

The Financial Secretary to the Treasury (Sir Edward Boyle): On a point of order, Sir William. I wonder whether I might make a suggestion which would be of help to the House. I do not think that this Amendment makes sense in the place where it is. Might I suggest that instead of debating this Amendment we go back to the earlier Amendment in page 8, line 25, after "to", insert
whichever is the less of the two following sums, that is to say eight hundred and ninety pounds and".
I think that that would make better sense.

Mr. Deputy-Speaker (Major Sir William Anstruther-Gray): I am in some difficulty. I do not think that it is possible to go back to an earlier Amendment. My understanding is that Mr. Speaker selected this Amendment for debate.

Mr. Mitchison: This is entirely my fault. The right figure is £890, which is the tax on £4,005. That is what I intended, as I am sure the House knows. I am sure that the hon. Gentleman knows that what I endeavoured to do by the Amendment was to confine the concession to people who get the two-ninths relief for earned income. I can see a number of kind hon. Gentlemen opposite nodding in understanding of what I meant. I am not sure that there need be a technical Amendment. If we were allowed to discuss the Amendment which has been moved on the principle of what was


intended, I think that that would meet the case. I gather that hon. Gentlemen opposite would agree to that course.

The Deputy-Speaker: I feel that it will be all right to proceed as we are.

Mr. Ellis Smith: Hon. Members on this side of the House would also agree to that course.

Mr. Mitchison: I am obliged to my hon. Friend. I have not got eyes in the back of my head.

Mr. Ellis Smith: It takes a big man to admit a mistake of that kind, and to that extent my hon. and learned Friend has my support.

Mr. Mitchison: The object of the Amendment and the Amendment to leave out lines 29 to 35 is to reduce considerably the amount of the Surtax concession. The object of the second Amendment is to omit paragraph (b) which amounts to not quite half the total amount—the exact figures are over £46, in one case, and over £37 in the other—and to confine the first concession to what I will call the two-ninths belt, that is to say, to confine it to cases where earned income relief is given to the extent of two-ninths, that is, up to the limit of £4,005, and of course the cases where more earned income relief is given but then only to limit it to that extent. I hope that I have made the meaning and the intention clear.
5.45 p.m.
This raises the general point about the Surtax concession. It raises it, perhaps, not in the same acute form but we on this side of the House object to the Surtax concession as a whole, and this is merely an attempt to reduce it since at this stage we cannot hope to eliminate it. We think that, in principle, it is wrong that a concession, even if it is not to come into operation immediately, should be given at a time when other taxes are being levied, taxes in the Finance Bill itself, and taxes in the form of National Insurance contributions and other matters about which I obviously cannot talk now but which I am sure are present in the minds of all hon. Members.
The Government's defence, as I understand it, has not been to minimise the difficulties of the present position. Indeed

recently, and even in the course of the debate we had a few moments ago, they have shown an acute sense of how urgent and serious those difficulties are or may be. They do not defend it by attempting to do that. What they say is that the Surtax concession is not to come in yet. It is something which will operate to some extent in 1962–63 and only fully in the following year, the point in those two cases being the difference between the way in which Surtax is levied on Schedule D earnings, and the way in which it is levied on Schedule E payments.
That is the position, but surely the answer is the simple one which has been given more than once already, that the prudent man—and we have to assume the prudent man for these purposes—sets aside his taxation liability when his earnings come to him. I see an hon. Member opposite shaking his head. I have a great deal of sympathy with him. I hate doing it myself, but I hope he will agree that if one has fluctuating earnings there is a need to be prudent. Therefore, when we are considering the balance which is to be achieved in this Budget we must consider the amount which is to be saved at the end of it and left in the Chancellor's hands. We must consider this Surtax concession even if it does not come into operation now as something which in its effect on the national economy will take place as soon as the law is passed and the earnings in question come to be considered.
Some of them, as we saw in an earlier debate, will already have been earned, but, one way or the other, there is no question that when one is considering the effect desired in the Budget as a whole and the effect of the Budget on the economy it is a false argument to say that the Surtax concession should be treated differently because from the point of view of the Revenue it does not come into effect this year or, indeed, into full effect for one or two years as the case may be.
What is happening is clear. I do not know whether it would be considered just or equitable if the people paying Surtax lived in a community by themselves, but in the community as we know it they are getting a concession on the ground that it is said to be just to them, or an incentive to them—both grounds


have been put forward—at the same time as taxes in other respects are being heavily increased; taxes in the form of payments by poor people and people who are sick; taxes in the form of a considerable burden on industry by the payment of the oil tax; and taxes in the form of an increase in Profits Tax on companies. That, too, is a tax on industry.
That is all for the benefit of a limited group of people, some 350,000 of them, who are getting the best of it at present, who are in a position to pay Surtax and as to whom all we ask in the Amendment is that the wealthiest of them should at least not get any more and that if, contrary to our view, an incentive is to be given, at least it should be confined to those who are in the group of the major executives or the minor executives—the important executives, or however one likes to describe them—the people who are earning their money, not at the rate which fortunate people such as Dr. Beeching manage to merit, or are supposed to merit, but who are in the position in which a highly intelligent person aged 30 or 40, with good connections and a lot of luck, might possibly find himself. That is the sort of person we are supposed to encourage.
If that is to be done, clearly the two-ninths belt—that is, up to an income of £4,000 or a little more—is as far as we ought to go. What this tax does is to open very large possibilities to people who are in receipt of very large incomes. They will get not only the two-ninths concession by way of earned income up to £4,000 but the additional one-ninth up to nearly £10,000 and, if the Clause is left as it is, the additional £2,000 which is to come off under subsection (1, b). On any view of what incentive ought to be given, we can only say that that is hopelessly excessive.
Objecting as we do to the Surtax concession as a whole, we might reasonably say that nothing should be given. We have said so already. We cannot enforce that view. We can at least insist that the concession is confined to the extent of, I was about to say, a reasonable income of a wealthy man. I do not want to put it quite like that, but it could be confined to the extent of the reasonable earnings of a competent, pushing, intelligent executive.
We do not admit the Government's case. It is a case which we would not concede when the economy as a whole is in difficulties and when the taxes which I have indicated are being levied on people far less well able to pay them than those concerned with paying Surtax. If we are to have the Government's proposition at all, let us have it confined to the very moderate, rather generous limits that would be left as a result of our Amendments.

Mr. Diamond: I strongly support the words of my hon. and learned Friend the Member for Kettering (Mr. Mitchison) in relation to the two Amendments. I hope that nobody will suggest that it is inopportune or inappropriate in any way for us to discuss this matter at this point of time.
It will be observed that the Government have so framed this legislation that this is the last opportunity we shall have of dealing with Surtax payable on 1st January, 1963. The Government have so framed their legislation that in this very Finance Bill, which we are discussing in July, 1961, we are today having our last opportunity of making any amendment whatever in Surtax which people will be called upon to pay in 1963.
The Government realise that the position by then may have changed and they want to protect their Surtax payers. They want to protect them against any possible reduction which should be made in the light of financial and economic circumstances obtaining in the future. Therefore, the Bill contains provision which, having come in unusually and extraordinarily this year, will not, as in the normal case, come in next year and be available for consideration then. The Opposition are being prevented from any opportunity of putting down Amendments next year to deal with this problem because of the way it is framed this year.
When I say "framed", I mean framed. The Opposition are being "framed" because they cannot exercise their democratic rights in dealing with Surtax next year as they normally could do and, indeed, as they would be doing in the preceding Clause this year. I have no need to do more than to refer to the preceding Clause to show which is the


normality and then to come to the Amendment, which relates to the abnormality.
My hon. and learned Friend was, as usual, courtesy in the extreme in dealing with an argument which nobody would attempt to bring against us, namely, that it was, perhaps, not entirely appropriate at this point of time to deal with Surtax which, admittedly, is not payable for some time ahead but the inflationary effect of which is felt now and as to which we can only now make our complaint if we are so minded.
On an earlier occasion, I said that there was no limit to the greed of hon. Members opposite. I retract not one syllable from that statement. Unless the Government are prepared to accept the Amendment, or something like it, they will have demonstrated how right and justifiable that statement was. We have just had an important debate relating to the economy of the country in which the Chancellor of the Exchequer has been unwilling to say whether he would put a most unusual tax, or two most unusual taxes, on the backs of the ordinary people within weeks of this date.
Everybody knows that there is a considerable likelihood of the Chancellor doing so and a considerable likelihood that the ordinary worker, the ordinary taxpayer and citizen, will be called upon shortly to pay more for all his necessities, all the things which he consumes in the ordinary way of life. Now, five minutes later, we are discussing the possibility of the Government having second thoughts and making a contribution to the healthy state of mind of the country and affecting relations between employer and employee and between rich and poor.
We want to see a happy community. We want to see workers and employers working together for the benefit of all of us. We are conscious that unhappy and unharmonious labour relations would do enormous damage to our vitally-needed export trade unless that disharmony is, as far as possible, removed.
One of the things which is at the root of that disharmony is the feeling that there is one law for the rich and one for the poor. We have just dealt with

the law of the poor in the previous Amendment, on which the Chancellor said that he would not deny himself the right, within days of the passing of the Bill, to bring forward legislation to put a tax upon the backs of every factory and every office worker.

Mr. John Hall: Everyone.

6.0 p.m.

Mr. Diamond: The hon. Member, quite properly, said "everyone". He knows that, of course, it bears more heavily on the poorer than on the richer. The hon. Member is a good deal taller than I am. If the same weight is put on his shoulders as that put on mine, assuming that our strength is in relation to our height it would be easier for him to carry that weight than for me. When everyone has the same weight put on their shoulders it is much harder for the poorer employee to bear it than for the Surtax payer.

Mr. John Hall: The hon. Member is so much nearer the ground. He has not so far to fall and would not hurt himself so much.

Mr. Gordon Walker: That is a typical attitude for the hon. Member for Wycombe (Mr. John Hall) to adopt.

Mr. Diamond: I am sorry, but I did not follow what the hon. Member for Wycombe said.

Mrs. Harriet Slater: Is not the logic of what the hon. Member for Wycombe (Mr. John Hall) said that the poorer a person is, the harder one may hit him and the harder he will fall?

Mr. John Hall: I find it extremely difficult to discover how my remarks could possibly be interpreted in that way.

Mr. Diamond: My hon. Friend the Member for Stoke-on-Trent, North (Mrs. Slater) thought the hon. Member meant something and I thought he meant nothing. I do not know who is right, but I will certainly repeat what I was saying, that the hon. Member rightly drew attention to the fact that the taxes and imposts which the Chancellor is proposing and which he is refusing to deny himself the right to use immediately after the Finance Bill becomes law, are of equal size and will have to be borne by all persons, tall or short, rich or poor.
Secondly, this affects the relationship between employer and employee and bears directly on the likelihood of our being able to pull ourselves out from our position at the bottom of the league compared with every other exporting country, where we have been under this Government now for two years. What is likely to pull us out of that position is an improvement in the relationship between the worker and the employer, a mutual feeling that each has a fair crack of the whip and fair shares in tax reliefs.
This Amendment deals with fairer shares, not completely fair, in tax reliefs. In the light of what the Chancellor said this afternoon, and of the recent debate, in the light of a number of unauthorised strikes taking place, the difficulties we experience in increasing production and increasing exports and in the light of falling invisible exports, the Amendment proposes that Surtax payers should make a contribution to the common welfare.
That contribution to the common welfare should at least say that under the proposals of the Chancellor by which the richer section of the community is to have in one fell swoop one half of its Surtax burden taken away notwithstanding that year after year as ordinary taxpayers it has benefited very considerably under this Government by having the burden of taxation reduced—I hope the hon. Member opposite is nodding in a sleepy way and not in a negative way.

Mr. Peter Walker: The hon. Member has spoken about a league. He has made a comparison with other countries, but will he remember the league in which this country, in relation to incidence of taxation, is taxed at a higher level on incomes? Even with the rebates which are to he made, that taxation is higher than in some of those countries.

Mr. Diamond: I wish that the hon. Member would be more specific. By the time the Surtax reliefs will have had their effect we shall be nothing like in the same position comparing high rates of taxation as we were. We shall be far behind our American friends, for example. They bear much higher rates.
This Amendment invites the richer section of the community, as represented by many hon. Members opposite, to say, "We recognise the need to make a con-

tribution to the common welfare. We have been offered in one fell swoop a cut of one half of Surtax liability, a total of £83 million spread over about a quarter of a million people. We feel that in the present state of the country and the anxiety expressed by the Chancellor, repeated here 20 minutes ago, we ought to make a contribution to the common welfare and to reduce our proposed savings on Surtax in the way outlined in these two Amendments."
I hope that when the Government reply is made we shall be told what amount would be involved. It is obvious that there would still be a very considerable saving to the Surtax payers and still a considerable cost to the Exchequer compared with the position before Budget day. These two Amendments would make a small contribution in money and would mean no hardship whatsoever on any individual. Every Surtax payer year after year since 1951, when this Government came into power, has continued to benefit. He knows for certain that, no matter what happens between now and 1963, he will get the benefit because the Government have circumvented the powers of the House to prevent him getting the benefit. The Surtax payer, therefore, should make a small contribution for the country and towards better relations between employer and employee, which could be improved.

Sir E. Boyle: So far as I could follow the speech of the hon. Member for Gloucester (Mr. Diamond), it seemed that his whole line of argument was directed to showing that the present Government, throughout their term of office, had been removing progressive taxation from those better off to those who are worse off. The only thing wrong with that argument is that it does not happen to be true.
As I have said on a number of occasions, and repeat for the benefit of the hon. Member, since 1951 the proportion of our total taxation taken up by progressive direct taxation has, in fact, risen and will rise further during the coming financial year. Perhaps he will recall that in the Budget estimates progressive direct taxation is estimated to yield very nearly £400 million mom during the next year than during the past year.
I shall return later in my remarks to the question of social harmony to which the hon. Member referred. Whatever criticism can be made of this Government, in my view it is absolutely ridiculous and extremely unfair to say that they have not allowed direct taxation to play its full part in our tax system. My hon. and right hon. Friends are perhaps more given to telling me that we have weighted the scales too high on the side of direct taxation. I certainly do not accept the contention that direct taxation has not played its proper part in our tax system in the last ten years.
I suggested an alternative form for these Amendments. I wish to take the opportunity of saying that the hon. and learned Member for Kettering (Mr. Mitchison) may have slipped up once, but I think that the whole House ought to remember how much we owe in these debates to his skill at drafting Amendments, because that is not the easiest thing to do and he has been responsible of a number of good and pointed debates.
These two Amendments fall into two parts. First, I will deal with the question of the two-ninths. As the House will remember, the present Minister of Aviation, in 1957, allowed an earned income allowance to apply right up into the Surtax scale for Income Tax purposes. I make no apology for the fact that under this Budget, from 1963 onwards, the earned income allowance will apply for two ninths up to £4,005 and then one ninth up to nearly £10,000 in respect of Surtax as well as Income Tax. That is a perfectly right and just provision.
Now I come to the second of the proposals, which is the more important. It is the proposal that we should not have the special earnings allowance. I was interested to hear what the hon. and learned Member for Kettering said about wealthy taxpayers. The House ought to recall that if the second Amendment were accepted a single man would begin to pay Surtax on his earning as soon as they exceeded £2,572. Furthermore, a married man with two young children both under 11 years of age would start to pay Surtax as soon as his earned income reached £2,957.
I refuse to believe that a man who has two children under 11, and who is earn-

ing less than £3,000 a year, can properly be regarded as a wealthy Surtax payer. I put to hon. Members opposite the point which I have made many times in these debates—that that man, before the war, would have been earning approximately £1,000 a year. Would anybody consider that, before the war, a man who was earning £1,000 a year, and who had two children under 11, could be called a wealthy man and regarded as somebody who ought to be paying Surtax? By exactly the same token, it would be quite wrong for someone earning less than £3,000 a year, and with two young children, to go on paying Surtax today.
Rather than apologise for these proposals, if anything, my right hon. and hon. Friends are to be criticised for not having introduced these proposals earlier in the post-war world. One has to look at this Budget in the context not of only one year, but of twenty years.
I want now to refer to the controversy between the hon. Member for Gloucester (Mr. Diamond) and my hon. Friend the Member for Worcester (Mr. Walker). I quoted a certain number of comparative figures when I spoke in the Budget debate. I pointed out that if a man who was earning £3,000 a year, and who had two young children, gained an extra £1,000 a year, in West Germany he would keep £673 of the extra £1,000 and in the United States he would keep £793. If the Amendment were accepted, in this country he would keep only £613 of the extra £1,000.
I have no wish to see England at the bottom of that particular league table. It is absolutely wrong that we should be so. I cannot believe that it is right that our tax treatment of a family man earning a salary in the region of £3,000 to £4,000 a year should be clearly and substantially less generous than that given by our two principal trade competitors.
Under the Government's plan, a man with two small children who is earning £3,000 a year would keep £699 of that extra £1,000. That is to say, we shall be slightly more generous that West Germany, but considerably less generous than the United States.

Mr. Nabarro: And France.

Sir E. Boyle: I think that my hon. Friend is right. It is a more satisfactory


situation than that which would prevail under the Amendment.
I absolutely agree with the hon. Member for Gloucester about the importance of preserving social harmony. I said in my Budget speech—I am not sure if the hon. Member for Edinburgh, East (Mr. Willis) was here—

Mr. E. G. Willis: I have heard the hon. Gentleman say this so often.

Sir E Boyle: I am not sorry to say it again.
Social justice and social harmony consist of treating everybody fairly and giving everybody his due. I cannot see why it should be supposed that only one section of the community can suffer a feeling of social injustice. Since the war, the tax on incomes which no one before the war would have pretended should be in the Surtax range, but which have been in since the war, has been high; this has created a feeling of injustice and must have blunted the competitive edge of British industry.
For that reason, I have no hesitation in advising the House to reject the Amendment and in saying that the Government intend to stand firm on the scheme which they have announced.

6.15 p.m.

Mr. Diamond: I am sure that the hon. Gentleman will give us the figures and will say to what extent there would be a reduction in the £83 million if the Amendments were accepted.

Sir E. Boyle: I will give the figures with pleasure. The cost of the first Amendment would not be very great. In a full year it would be about £4½ million out of the £83 million.
The second Amendment is considerably the more important, which is one of the reasons why I laid stress on it. If there were not a special earnings allowance, the two Amendments would claw back £29½ million in 1962–63 and £42 million in a full year. That is the cost of both Amendments together.
I again remind the House of the provisions about Profits Tax which my right hon. and learned Friend has made this year and that which Lord Amory made last year. Against the reductions in Surtax which my right hon. and learned Friend has announced, we have to con-

sider two increases in Profits Tax, bringing up the rate from 10 per cent. to 15 per cent. I cannot see any grounds for saying that the economic and social policies of the Government have been in the interests of one section of the community. The Government have no hesitation in standing firm on their own proposals.

Mr. Houghton: It is only by permission of the House that I can speak again. It was in the very temporary and unavoidable absence of my hon. and learned Friend the Member for Kettering (Mr. Mitchison) that I actually moved the first of the two Amendments, although I did not speak to either. May I have that permission, Mr. Speaker?

Mr. Speaker: The hon. Member must ask the House. I dare say that he will have permission.

Mr. Houghton: We have heard from the Financial Secretary, in his usual gracious way, the two main points about our proposals which we have gone over so much during these debates on the Surtax concessions. They have been, firstly, the purpose of these very drastic reductions in Surtax and, secondly, how the concessions are to be paid for in the present financial and economic situation.
The purpose, and the only justifiable purpose, of the concessions in this Bill this year is that put forward from the outset by the Chancellor, that these concessions were desirable if not absolutely necessary to give a boost to the economy. He seemed to rest his expectations on the conclusions of a book published by the National Union of Manufacturers. It said:
Any Government with courage to revise Surtax on these lines will find it has touched a spring that will instantly release the flood of energy and enterprise essential for the great advance to prosperity the nation so desires to see.
But throughout the whole of the debate, we have not had any evidence to show that that hope will be fulfilled.
Earlier in the book there was an undeserved slur on the initiative and ambition of executives and businessmen generally within the Surtax range. I quote from page 10:
When the most promising technicians and executives hold back from accepting higher posts with greater responsibilities because the extra reward is disproportionate to the strain of office, the nation is the loser.


Throughout these debates only one hon. Member, the hon. Member for Spelthorne (Sir B. Craddock), has given any actual case in his own experience where art executive or technician has held back from assuming duties, carrying higher responsibility and higher remuneration, because of the inroad of Surtax upon the extra pay.

Mr. John Hall: The hon. Gentleman is mistaken, because I myself gave an example.

Mr. Houghton: I beg the hon. Gentleman's pardon. So there are two hon. Members and not one. If there were any more, they certainly escape me, and I have been closely attending the debates throughout.
Surely the point is that there is no evidence behind these assertions—none. Responsible researchers have discovered no evidence. It is regrettable that there has been such a lack of evidence of the impressions, expectations and assertions voiced in support of these drastic reductions in Surtax throughout these debates. Let us go back to the beginning and recall what the Chancellor said on 17th July. This was the foundation stone of the proposals costing the Exchequer £83 million in the first operative year. The Chancellor said:
I have received many representations about the need to reduce the levels of direct taxation, particularly Surtax. Surtax begins at £2,000. This figure was fixed in 1920. I learn from many quarters, sometimes unexpected quarters, that the present scope and level of Surtax is a substantial disincentive to effort and initiativc."—[OFFICIAL REPORT, 17th April, 1961; Vol. 638, c. 819.]
But surely if these drastic reductions in taxation are to rest upon a statement of that kind we should have had more tangible evidence in support of it in the course of the long debates on Surtax.

Mr. Nabarro: The Chancellor's words alluded to "many quarters". There are at least three right hon. and hon. Gentlemen opposite who are on record in print as advocating drastic reductions in direct taxation—

Mr. Ellis Smith: Give us the names.

Mr. Nabarro: —to give additional incentive for export production. The three I name are the right hon. Gentleman the Leader of the Opposition, the

hon. Member for Sowerby (Mr. Houghton) writing in Yorkshire newspapers, and none other than that authority on fiscal matters and thorough-going Socialist, the leader of the Leicestershire miners, the hon. Member for Bosworth (Mr. Wyatt). Where is the hon. Member for Bosworth?

Mr. Houghton: The hon. Gentleman should not mislead the House by giving general references to comments which have been made in different contexts by different right hon. and hon. Gentlemen. No one that he has mentioned, as far as I can recall, has proposed a reduction of Surtax in this year's Finance Bill or this year's economic situation for the reasons given by the Chancellor of the Exchequer. As for the hon. Member for Kidderminster (Mr. Nabarro) himself, we missed him greatly in the discussions on this matter during the Committee stage of the Bill.

Mr. Nabarro: I was absent, sadly incommoded.

Mr. Houghton: I beg the hon. Gentleman's pardon if he could not be here, but it is worth while recalling that the only two comments that we heard from him throughout the whole of the discussions on the matter were on Budget day when the Chancellor announced these drastic reductions in Surtax. The hon. Gentleman was so flabbergasted at their generosity that he intervened to say:
Say that again.
Apparently, the hon. Gentleman could not believe his own ears. The Chancellor replied that the hon. Member for Kidderminster could read it. After the Chancellor had spoken for another minute, it had sunk in, and then the hon. Member for Kidderminster said:
Jolly good."—[OFFICIAL REPORT, 17th April, 1961; Vol. 638, c. 820.]

Mr. Nabarro: Perhaps I might just give a word of explanation. I said "Say it again" on Budget day because the Chancellor's explanation was extremely technical and difficult to follow. Later, after the Chancellor had said that I could read it in print and had continued for another sentence, I then expressed my note of strong approval and approbation of what he had done by interpolating "Jolly good".

Mr. Ellis Smith: The hon. Gentleman touched his hat.

Mr. Houghton: I fully accept what the hon. Gentleman says, obviously, but I leave the matter on this footing, that we have had no real tangible evidence throughout the whole of the debates on these Clauses in support of the premises upon which these drastic reductions were put forward. That is beyond any denial whatsoever.
During the Committee stage of the Bill, we on these benches did not seek to modify or mutilate the Surtax proposals. We thought it better at that stage to oppose them altogether. There were, however, two respects in which we thought some mistake should be put right.
We tried to exclude from the benefit of the Surtax reductions income already earned by the Schedule D taxpayers. Having regard to the Chancellor's intention to provide a stimulus for the future, we saw no reason to extend benefits to the past. Secondly, we thought it was wrong to allow substantial business expenses to be deducted from Surtax assessments which were to be so heavily reduced. However, both proposals were rejected. Our opposition to the Clauses as a whole was overridden by the majority on the Government benches. That is why, putting forward our Amendments at the present moment, we felt free to suggest cuts in the reductions which the Chancellor has proposed.
The other point that has been raised is about paying for these Surtax reductions. This is a disinflationary Budget; this is a counter-inflationary Bill. We are all agreed on that. We realise that. We understand the seriousness of the economic situation. Therefore, reductions in direct taxation of this magnitude at this time clearly had to be met by additions to taxation elsewhere. The Chancellor has increased taxation in this Bill. There is a net increase in taxation this year of £60 or £70 million. Therefore, the Chancellor proposed that there should be an increase in Profits Tax in order to pay for the Surtax reductions.
I do not think that the House can accept that simple equation. If the Profits Tax can be increased to pay for Surtax reductions, the Purchase Tax could have been increased to pay for other reductions more justifiable in our

view. It can be argued, of course, that there is some direct relationship between the Surtax reductions and the increased prosperity of the companies for which the people concerned work. I strongly question any such theory. I do not believe that the cuts in Surtax will of themselves put companies in a better financial position to pay the additional Profits Tax. I think that the House will agree that other measures were taken by the Chancellor of the Exchequer, some in this Bill, and some before this Bill, to accommodate these reductions in Surtax this year.
6.30 p.m.
They will be paid for in part by the people on £1,000 a year and on £500 a year—who are poorer than the poor man on £5,000 a year. They will be paid for in part by larger insurance contributions —larger than needed to pay the graduated benefits under the new scheme. They will be paid for in part by Health Service charges in excess of the estimate of the additional expenditure on the Health Service. They will be paid for in part by rates of interest on mortgages that are far higher than are necessary to pay the additional Profits Tax on the lending bodies.
It is quite a mistaken theory that these reductions are being paid for by increases in Profits Tax, and, in those circumstances, I think that the House, even at this late hour, has to re-examine the basis upon which it is asked to sanction these very important reductions in direct taxation.
We are inclined to talk of Surtax as if it were some additional overload of taxation resting expressly and specifically on a certain class or group of people, but it is, of course, an extension of our system of graduated taxation. That is all it really is, although it is given a different name and is administered separately from Income Tax beyond that point.
There are ways of reducing the burden of graduated tax other than lifting the starting point of that tax. The Chancellor had the alternative of reducing the rates of Surtax. After all, the lowest rate above the Surtax limit of £2,000 is only 2s. in the £. It then goes up by sixpences and shillings to the admittedly very high rate of 10s. in the £ for incomes of £15,000 a year and upwards;


but not, of course, on the whole of the £15,000.
A lot of people seem to think that when a person enters that range, Surtax is imposed on all the income, but it is, in fact, a marginal rate of taxation. I do not minimise its importance to those who pay it—

Mr. Nabarro: The hon. Gentleman ought to know.

Mr. Houghton: Of course I ought to know, because I pay it—

Mr. Nabarro: Hear, hear.

Mr. Houghton: —but I cannot understand why the hon. Member for Kidderminster should think it unbecoming in a Surtax payer to oppose Surtax reductions. I should have thought that there was greater virtue in a Surtax payer opposing such a reduction than in one who does not pay it. For my part, I sincerely and strongly dissent from Surtax relief when other people are having to assume additional burdens in order to make room for these reductions in the financial provisions for this year—

Mr. Nabarro: Mr. Nabarro rose—

Mr. Houghton: No, I will not give way. I therefore hope that I have heard the last of that taunt. If I may say so, I do not think that it reflects on me but on the hon. Member for Kidderminster who, apparently, cannot understand anyone in the Surtax range holding such an opinion as I hold, and such as my hon. and right hon. Friends hold about these proposed reductions.
The House will realise that the Chancellor had other means of alleviating the burden—we will use that word if the House likes it—of Surtax. In present circumstances, these reductions go far beyond anything that we could possibly contemplate. As I said before, I think that the Chancellor has chosen the midyear in the present Parliament to undertake a step that would be very unpopular nearer election time, which has not received the approval of the country as a whole and which it is misleading the public to suggest is of some benefit to the country.
That is why we have sought to reduce the excessive relaxations of Surtax that the Chancellor has proposed. Something

more modest, as a token of things to come in better times, would surely have been more prudent in present circumstances, but the right hon. and learned Gentleman has gone the whole hog. That, I submit, with great respect to him, is reckless if, indeed, it is not absolutely irresponsible.

Mrs. Slater: I did not intend to speak on this Amendment, but I have a very great respect for the Financial Secretary, especially for the work he did at the Ministry of Education, and I did not enjoy hearing him say that these reliefs in Surtax were on the lines of creating harmony among the people, and particularly among our workers. It is not the sort of thing that he has said on other occasions. I do not believe that these reliefs do anything at all to create harmony and to encourage the ordinary workers.
The hon. Gentleman said that if the first Amendment were accepted it would claw back—that was the phrase he used —£4½ million out of the Surtax relief. During our debates on the National Health Service Contributions Bill, hon. Members on this side, by Amendments relating to welfare foods, relief of old people and of the handicapped, attempted to claw back out of the amount which the Chancellor collected —because it is the Chancellor and not the Minister of Health who really collects the extra money that started to be paid yesterday, and many workers will not realise the extra charge until they receive their pay packets on Friday —£½ million, £1¼ million, £3 million, £4 million. In every case we were resisted by the Government, by these people who are most concerned tonight that not £½ million, or £1 million or £4½ million shall be taken from these poor folk to whom the Chancellor referred—the Surtax payers.
We feel that tax relief on this scale creates disharmony at a time when we have just started to collect an extra £65 million in National Health contributions from the workers, though the Minister of Health said that he would spend only £5 million more on what he said he needed the money for: the provision of hospitals. The added burdens imposed during the last year by taxation, by increased contributions in one form or another, do not lead us to believe that these Surtax reliefs are warranted.
There are those who feel that this step does not create harmony at all. I have had a letter from a war widow who has gone on working until she is now 64 years of age. She has paid all her different pension contributions and so gets a little extra as a war widow and as an old-age pensioner. Out of what she gets she has to pay 10s. in tax. People like that feel that there is injustice, and not justice at the present time—

Viscount Hinchingbrooke: I am very interested in that, but the evidence that we want from the other side of the House is just those people writing to the hon. Lady complaining about the operation of this Clause.

Mrs. Slater: I can send the noble Lord the letter if he likes, and he can then learn how this woman feels about Surtax relief.
Hon. Gentlemen opposite do not seem to think that anyone has the courage to object to this kind of thing. They said exactly the same about the 2s. prescription charge—that people were not worried and were not protesting about it. But I can assure hon. Gentlemen opposite that they are protesting, although hon. Gentlemen opposite do not understand that the people who are suffering know that it is just of no use writing to Conservative hon. Members. Obviously, people such as the woman I have described are bound to feel that no harmony or justice is being meted out to them.
If we are in difficult economic circumstances—and we are being repeatedly told that we are—the Government should at least do justice to the workers and the labour force who are so necessary, and even the most influential business directors—

Mr. Ellis Smith: Now listen to this!

Mrs. Slater: —are of no value if they have not got the good will of the men and women at the work benches. In the final analysis these are the people on whom the Government must rely, and for that reason the Amendment seeks to at least bring about some measure of justice for the workers, who represent the majority of people in this country.
The action of the Government, an does the speech of the Financial Secretary, makes it clear beyond doubt that the Government are interested only with those in the higher income brackets and not with the majority who are receiving lower incomes, such as the widows, old-age pensioners and those who are having to pay increased contributions and higher prescription charges. While those in this category are reacting and protesting, pressure is brought to bear upon the Government by those who have the power who are in circles suitable for bringing their power to bear on the Government.

Mr. Nabarro: Mr. Nabarro rose—

Mrs. Slater: I shall not give way. The hon. Gentleman must wait for his turn to speak.
I was saying that these influential people have brought pressure to bear on the Treasury during the last twelve months and many of the actions of this Government have in many ways proved that they are paying back in full measure those people who supported the Conservative Party at the last election.

Mr. H. Wilson: I do not intend to make a speech, but it should be made clear to the House what procedure we intend to follow with regard to voting on these Amendments. There is a drafting defect in the first Amendment, for which my hon. and learned Friend the Member for Kettering (Mr. Mitchison) has taken responsibility—and I must say that not only the Opposition but the House generally owes a debt to my hon. and learned Friend for the drafting advice that he has rendered. But since this drafting defect, which is accidental and is so refined a point that hardly anyone spotted it until late, and since the second Amendment raises a question that is far more substantial both in terms of principle and in terms of the sums involved, we would propose, Mr. Speaker, if you call both Amendments, to let the first one be negatived and to vote on the second.

Amendment negatived.

Amendment proposed, in page 8.

Leave out lines 29 to 35.—[Mr. Mitchison.]

Question put, That the words proposed to be left out stand part of the Bill:—

The House divided: Ayes 237, Noes 188.

Division No. 240.]
AYES
[6.44 p.m.


Agnew, Sir Peter
Goodhart, Philip
Montgomery, Fergus


Aitken, W. T.
Gower, Raymond
More, Jasper (Ludlow)


Allason, James
Grant, Rt. Hon. William
Morgan, William


Arbuthnot, John
Green, Alan
Nabarro, Gerald


Ashton, Sir Hubert
Grimston, Sir Robert
Nicholls, Sir Harmar


Atkins, Humphrey
Grosvenor, Lt.-Col. R. G.
Nicholson, Sir Godfrey


Barber, Anthony
Gurden, Harold
Noble, Michael


Barlow, Sir John
Hall, John (Wycombe)
Nugent, Sir Richard


Barter, John
Hamilton, Michael (Wellingborough)
Oakshott, Sir Hendrie


Bell, Ronald
Harris, Frederic (Croydon, N.W.)
Osborn, John (Hallam)


Bennett, F. M. (Torquay)
Harris, Reader (Heston)
Osborne, Sir Cyril (Louth)


Berkeley, Humphry
Harrison, Col. Sir Harwood (Eye)
Page, John (Harrow, West)


Bidgood, John C.
Harvey, John (Walthamstow, E.)
Page, Graham (Crosby)


Bingham, R. M.
Harvie Anderson, Miss
Partridge, E.


Birch, Rt. Hon. Nigel
Heald Rt. Hon. sir Lionel
Pearson, Frank (Clitheroe)


Bishop, F. P.
Henderson, John (Cathcart)
Peel, John


Black, Sir Cyril
Henderson-Stewart, Sir James
Peyton, John


Bourne-Arton, A.
Hicks Beach, Maj. W.
Pickthorn, Sir Kenneth


Box, Donald
Hiley, Joseph
Pilkington, Sir Richard


Boyd-Carpenter, Rt. Hon. John
Hill, Dr. Rt. Hon. Charles (Luton)
Pitman, Sir James


Boyle, Sir Edward
Hill, Mrs. Eveline (Wythenshawe)
Pitt, Miss Edith


Brewis, John
Hill, J. E. B. (S. Norfolk)
Pott, Percivall


Brooke, Rt. Hon. Henry
Hinchingbrooke, Viscount
Price, David (Eastleigh)


Brooman-White, R.
Hirst, Geoffrey
Proudfoot, Wilfred


Bryan, Paul
Hobson, John
Quennell, Miss J. M.


Buck, Antony
Hocking, Philip N.
Redmayne, Rt. Hon. Martin


Bullard, Denys
Holland, Philip
Rees, Hugh


Burden, F. A.
Hollingworth, John
Rees-Davies, W. R.


Butler, Rt.Hn.R.A.(Saffron Walden)
Hopkins, Alan
Renton, David


Campbell, Sir David (Belfast, S.)
Hornsby-Smith, Rt. Hon. Patricia
Ridley, Hon. Nicholas


Campbell, Gordon (Moray &amp; Nairn)
Howard, John (Southampton, Test)
Ridsdale, Julian


Cary, Sir Robert
Hughes-Young, Michael
Robson Brown, Sir William


Channon, H. P. G.
Hulbert, Sir Norman
Roots, William


Chataway, Christopher
Hutchison, Michael Clark
Ropner, Col. Sir Leonard


Clark, Henry (Antrim, N.)
Iremonger, T. L.
Royle, Anthony (Richmond, Surrey)


Clark, William (Nottingham, s.)
Jackson, John
Russell, Ronald


Clarke, Brig. Terence (Portsmth, W.)
James, David
Scott-Hopkins, James


Cleaver, Leonard
Jenkins, Robert (Dulwich)
Seymour, Leslie


Cole, Norman
Jennings, J. C.
Shaw, M,


Cooper-Key, Sir Neill
Johnson, Dr. Donald (Carlisle)
Skeet, T. H. H.


Cordeaux, Lt.-Col. J. K.
Johnson, Eric (Blackley)
Smith, Dudley (Br'ntf'rd &amp; Chiswick)


Corfield, F. V.
Johnson Smith, Geoffrey
Smithers, Peter


Costain, A. P.
Kaberry, Sir Donald
Spearman, Sir Alexander


Courtney, Cdr. Anthony
Kershaw, Anthony
Speir, Rupert


Craddock, Sir Beresford
Lagden, Godfrey
Stevens, Geoffrey


Critchley, Julian
Leather, E. H. C.
Stoddart-Scott, Col. Sir Malcolm


Cunningham, Knox
Leavey, J. A.
Storey, Sir Samuel


Curran, Charles
Leburn, Gilmour
Studholme, Sir Henry


Currie, G. B. H.
Lewis, Kenneth (Rutland)
Summers, Sir Spencer (Aylesbury)


Dalkeith, Earl of
Lindsay, Martin
Talbot, John E.


d'Avigdor-Goldsmld, Sir Henry
Litchfield, Capt. John
Tapsell, Peter


Deedes, W. F.
Lloyd, Rt. Hon. Selwyn (Wirral)
Taylor, Edwin (Bolton, E.)


Donaldson, Cmdr. C. E. M.
Longden, Gilbert
Teeling, William


Doughty, Charles
Loveys, Walter H.
Temple, John M.


du Cann, Edward
Low, Rt. Hon. Sir Toby
Thatcher, Mrs. Margaret


Duncan, Sir James
Lucas, Sir Jocelyn
Thomas, Leslie (Canterbury)


Eden, John
Lucas-Tooth, Sir Hugh
Thomas, Peter (Conway)


Elliot, Capt. Walter (Carshaiton)
McAdden, Stephen
Thompson, Kenneth (Walton)


Elliott, R.W.(Nwcstle-upon-Tyne,N.)
MacArthur, Ian
Thornton-Kemsley, Sir Colin


Emery, Peter
McLaughlin, Mrs. Patricla
Tiley, Arthur (Bradford, W.)


Erroll, Rt. Hon. F. J.
Maclay, Rt. Hon. John
Turner, Colin


Farey-Jones, F. W.
Maclean,SirFitzroy(Bute&amp;N.Ayra.)
Turton, Rt. Hon. R. H.


Farr, John
Macleod, Rt. Hon. Iain(Enfield, W.)
Tweedsmuir, Lady


Finlay, Graeme
MacLeod, John (Ross &amp; Cromarty)
van Straubenzee, W. R.


Fisher, Nigel
McMaster, Stanley R.
Vaughan-Morgan, Rt. Hon. Sir John


Fletcher-Cooke, Charles
Maddan, Martin
Vosper, Rt. Hon. Dennis


Forrest, George
Maginnis, John E.
Wakefield, Edward (Derbyshire, W.)


Foster, John
Maitland, Sir John
Wakefield, Sir Wavel (St. M'lebone)


Fraser, Ian (Plymouth, Sutton)
Markham, Major Sir Frank
Walder, David


Freeth, Denzil
Marshall, Douglas
Walker, Peter


Galbraith, Hon. T. G. D.
Marten, Neil
Walker-Smith, Rt. Hon. Sir Derek


Gammans, Lady
Mathew, Robert (Honiton)
Wall, Patrick


Gardner, Edward
Matthews, Gordon (Meriden)
Ward, Dame Irene


Glover, Sir Douglas
Mawby, Ray
Webster, David


Glyn, Dr. Alan (Clapham)
Maxwell-Hyslop, R. J.
Wells, John (Maidstone)


Glyn, Sir Richard (Dorset, N.)
Maydon, Lt.-Cmdr. S. L. C.
Williams, Dudley (Exeter)


Godber, J. B.
Mills, Stratton
Williams, Paul (Sunderland, S.)




Wills, Sir Gerald (Bridgwater)
Woodnutt, Mark
TELLERS FOR THE AYES:


Wilson, Geoffrey (Truro)
Woollam, John
Mr. Chichester-Clark and


Woodhouse, C. M.
Worsley, Marcus
Mr. Whitelaw.




NOES


Ainsley, William
Howell, Denis (Small Heath)
Price, J. T. (Westhoughton)


Albu, Austen
Hoy, James H.
Probert, Arthur


Allen, Scholefield (Crewe)
Hughes, Cledwyn (Anglesey)
Randall, Harry


Awbery, Stan
Hughes, Emrys (S. Ayrshire)
Rankin, John


Bacon, Miss Alice
Hunter, A. E.
Reynolds, G. W.


Baxter, William (Stirlingshire, W.)
Hynd, H. (Accrington)
Roberts, Albert (Normanton)


Bence, Cyril
Hynd, John (Attercliffe)
Roberts, Goronwy (Caernarvon)


Benson, Sir George
Irvine, A. J. (Edge Hill)
Robertson, John (Paisley)


Blyton, William
Irving, Sydney (Dartford)
Robinson, Kenneth (St. Pancras, N.)


Boardman, H.
Jay, Rt. Hon. Douglas
Rogers, G. H. R. (Kensington, N.)


Bowden, Herbert W. (Leics, S.W.)
Jenkins, Roy (Stechrord)
Ross, William


Bowles, Frank
Johnson, Carol (Lewisham, S.)
Royle, Charles (Saiford, West)


Boyden, James
Jones, Rt. Hn.A. Creech (Wakefield)
Shinwell, Rt. Hon. E.


Braddock, Mrs. E. M.
Jones, Dan (Burnley)
Short, Edward


Brockway, A. Fenner
Jones, Jack (Rotherham)
Silverman, Julius (Aston)


Brown, Alan (Tottenham)
Jones, J. Idwal (Wrexham)
Silverman, Sydney (Nelson)


Brown, Rt. Hon. George (Belper)
Jones, T. W. (Merioneth)
Skeffington, Arthur


Butler, Herbert (Hackney, C.)
Kelley, Richard
Slater, Mrs. Harriet (Stoke, N.)


Butler, Mrs. Joyce (Wood Green)




Callaghan, James
Kenyon, Clifford
Slater, Joseph (Sodgefield)


Castile, Mrs. Barbara
Key, Rt. Hon. C. W.
Small, William


Chetwynd, George
King, Dr. Horace
Smith, Ellis (Stoke, S.)



Lawson, George
Sorensen, R. W.


Cronin, John




Crosland, Anthony
Ledger, Ron
Spriggs, Leslie


Crossman, R. H. S.
Lee, Frederick (Newton)
Steele, Thomas


Cullen, Mrs. Alice
Leo, Miss Jennie (Cannock)
Stewart, Michael (Fulham)


Davies, G. Elfed (Rhondda, E.)
Lewis, Arthur (West Ham, N.)
Stones, William


Davies, Harold (Leek)
Lipton, Marcus
Strachey, Rt. Hon. John


Davies, S. O. (Merthyr)
Loughlin, Charles
Strauss, Rt. Hn. G. R. (Vauxhall)


de Freitas, Geoffrey
Mabon, Dr. J. Dickson
Stross,Dr.Barnett(Stoke-on-Trent,C.)


Delargy, Hugh
McCann, John
Swain, Thomas


Diamond, John
MacColl, James
Swingler, Stephen


Dodds, Norman
Mclnnes, James
Symonds, J. B.


Dugdale, Rt. Hon. John
McKay, John (Wallsend)
Taylor, Bernard (Mansfield)


Ede, Rt. Hon. C.
Mackie, John (Enfield, East)
Taylor, John (West Lothian)


Edwards, Rt. Hon. Ness (Caerphilly)
McLeavy, Frank
Thomas, Iorwerth (Rhondda, W.)


Edwards, Walter (Stepney)
MacPherson, Malcolm (Stirling)
Thompson, Dr. Alan (Dunfermline)


Evans, Albert
Mallalieu, E. L. (Brigg)
Thomson, C. M. (Dundee, E.)


Fitch, Alan
Mallalieu, J.P.W.(Huddersfield,E.)
Thornton, Ernest


Fletcher, Eric
Manuel, A. C.
Timmons, John


Fraser, Thomas (Hamilton)
Mapp, Charles
Tomney, Frank


Gaitskell, Rt. Hon. Hugh
Marsh, Richard
Ungoed-Thomas, Sir Lynn


Galpern, Sir Myer
Mendelson, J. J.
Wade, Donald


George, Lady MeganLloyd(Crmrthn)
Milne, Edward J.
Wainwright, Edwin


Ginsburg, David
Mitchison, G. R.
Warbey, William


Gordon Walker, Rt. Hon. P. C.
Monslow, Walter
Watkins, Tudor


Gourlay, Harry
Moody, A. S.
Weitzman, David


Greenwood, Anthony
Mort, D. L.
Wells, William (Walsall, N.)


Grey, Charles
Moyle, Arthur
White, Mrs. Eirene


Griffiths, Rt. Hon. James (Llanelly)
Mulley, Frederick
Whitlock, William


Griffiths, W. (Exchange)
Neat, Harold
Wilkins, W. A.


Grimond, J.
Noel-Baker, Francis (Swindon).
Willey, Frederick


Hale, Leslie (Oldham, W.)
Oliver, G. H
Williams, D. J. (Neath)


Hall, Rt. Hn. Glenvil (Colne Valley)
Oram, A. E.
Williams, Ll. (Abertillery)


Hamilton, William (West Fife)
Owen, Will
Williams, W. R. (Openshaw)


Hannan, William
Padley, W. E.
Williams, W. T. (Warrington)


Hart, Mrs. Judith
Pannell, Charles (Leeds, W.)
Willis, E. C. (Edinburgh, E.)


Hayman, F. H.
Parker, John
Wilson, Rt. Hon. Harold (Huyton)


Healey, Denis
Parkin, B. T.
Winterbottom, R. E.


Hilton, A. V.
Pavitt, Laurence
Woodburn, Rt. Hon. A.


Holman, Percy
Pearson, Arthur (Pontypridd)
Woof, Robert


Holt, Arthur
Pentland, Norman
Zilliacus, K.


Houghton, Douglas
Popplewell, Ernest



Howell, Charles A. (Perry Barr)
Prentice, R. E.
TELLERS FOR THE NOES:




Mr. Redhead and Dr. Broughton.

Clause 27.—(SURCHARGES ON EMPLOYERS.)

Amendment proposed, In page 21, line 21, leave out "with" and insert "three months after"—instead thereof.—[Mr. H. Wilson.]

Question put, That "with" stand part of the Bill:—

The House divided: Ayes 238, Noes 185.

Division No. 241.]
AYES
[6.55 p.m.


Agnew, Sir Peter
Allason, James
Atkins, Humphery


Aitken, W. T.
Arbuthnot, John
Barber, Anthony


Allan, Robert (Paddington, S.)
Ashton, Sir Hubert
Barlow, sir john




Barter, John
Harris, Frederic (Croydon, N.W.)
Page, John (Harrow, West)


Bell, Ronald
Harris, Reader (Heston)
Page, Graham (Crosby)


Bennett, F. M. (Torquay)
Harvey, John (Walthamstow, E.)
Partridge, E.


Berkeley, Humphry
Harvie Anderson, Miss
Pearson, Frank (Clitheroe)


Bidgood, John C.
Heald, Rt. Hon. Sir Lionel
Peel, John


Bingham, R. M.
Henderson, John (Cathcart)
Peyton, John


Birch, Rt. Hon. Nigel
Henderson-Stewart, Sir James
Pickthorn, Sir Kenneth


Bishop, F. P.
Hicks Beach, Maj. W.
Pilkington, Sir Richard


Black, Sir Cyril
Hiley, Joseph
Pitman, Sir James


Bourne-Arton, A.
Hill, Dr. Rt. Hon. Charles (Luton)
Pitt, Miss Edith


Box, Donald
Hill, Mrs. Eveline (Wythenshawe)
Pott, Percivall


Boyd-Carpenter, Rt. Hon. John
Hill, J. E. B. (S. Norfolk)
Price, David (Eastleigh)


Boyle, Sir Edward
Hinchingbrooke, Viscount
Proudfoot, Wilfred


Brewis, John
Hirst, Geoffrey
Quennell, Miss J. M.


Brooke, Rt. Hon. Henry
Hobson, John
Redmayne, Rt. Hon. Martin


Brooman-White, R.
Hocking, Philip N.
Rees, Hugh


Bryan, Paul
Holland, Philip
Rees-Davies, W. R.


Buck, Antony
Hollingworth, John
Renton, David


Bullard, Denys
Hopkins, Alan
Ridley, Hon. Nicholas


Burden, F. A.
Hornsby-Smith, Rt. Hon. Patricia
Ridsdale, Julian


Butler, Rt.Hn.R.A.(Saffron Walden)
Howard, John (Southampton, Test)
Robson Brown, Sir William


Campbell, Sir David (Belfast, S.)
Hughes-Young, Michael
Roots, William


Campbell, Gordon (Moray &amp; Nairn)
Hulbert, Sir Norman
Ropner, Col. Sir Leonard


Cary, Sir Robert
Hutchison, Michael Clark
Royle, Anthony (Richmond, Surrey)


Channon, H. P. G.
Iremonger, T. L.
Russell, Ronald


Chataway, Christopher
Jackson, John
Scott-Hopkins, James


Chichester-Clark, R.
James, David
Seymour, Leslie


Clark, Henry (Antrim, N.)
Jenkins, Robert (Dulwich)
Shaw, M.


Clark, William (Nottingham, S.)
Jennings, J. C.
Skeet, T. H. H.


Clarke, Brig. Terence (Portsmth, W.)
Johnson, Dr. Donald (Carlisle)
Smith, Dudley (Br'ntf'rd &amp; Chiswick)


Cleaver, Leonard
Johnson, Eric (Blackley)
Smithers, Peter


Cole, Norman
Johnson Smith, Geoffrey
Spearman, Sir Alexander


Cooper, A. E.
Kaberry, Sir Donald
Speir, Rupert


Cooper-Key, Sir Neill
Kershaw, Anthony
Stevens, Geoffrey


Cordeaux, L.t.-Col. J. K.
Lagden, Godfrey
Stoddart-Scott, Col. Sir Malcolm


Corfield, F. V.
Leather, E. H. C.
Storey, Sir Samuel


Costain, A. P.
Leavey, J. A.
Studholme, Sir Henry


Courtney, Cdr. Anthony
Leburn, Gilmour
Summers, Sir Spencer (Aylesbury)


Craddock, Sir Beresford
Lewis, Kenneth (Rutland)
Talbot, John E.


Critchley, Julian
Lindsay, Martin
Tapsell, Peter


Cunningham, Knox
Litchfield, Capt. John
Taylor, Edwin (Bolton, E.)


Curran, Charles
Lloyd, Rt. Hon. Selwyn (Wirral)
Teeling, William


Currie, G. B. H.
Longden, Gilbert
Temple, John M.


Dalkeith, Earl of
Loveys, Walter H.
Thatcher, Mrs. Margaret


d'Avlgdor-Goldsmid, Sir Henry
Low, Rt. Hon. Sir Toby
Thomas, Leslie (Canterbury)


Deedes, W. F.
Lucas, Sir Jocelyn
Thomas, Peter (Conway)


Donaldson, Cmdr. C. E. M.
Lucas-Tooth, Sir Hugh
Thompson, Kenneth (Walton)


Doughty, Charles
McAdden, Stephen
Thornton-Kemsley, Sir Colin


du Cann, Edward
MacArthur, Ian
Tiley, Arthur (Bradford, W.)


Duncan, Sir James
McLaughlin, Mrs. Patricia
Turner, Colin


Eden, John
Maclay, Rt. Hon. John
Turton, Rt. Hon. R. H.


Elliot, Capt. Walter (Carshalton)
Maclean,SirFitzroy (Bute &amp;N. Ayrs.)
Tweedsmuir, Lady


Elliott, R.W.(Nwcstle-upon-Tyne,N.)
Macleod, Rt. Hn. Iain (Enfield, W.)
van Straubenzee, W. R.


Emery, Peter
MacLeod, John (Ross &amp; Cromarty)
Vaughan-Morgan, Rt. Hon. Sir John


Erroll, Rt. Hon. F. J.
McMaster, Stanley R.
Vosper, Rt. Hon. Dennis


Farey-Jones, F. W.
Maddan, Martin
Wakefield, Edward (Derbyshire, W.)


Farr, John
Maginnis, John E.
Wakefield, Sir Waved (St. M'lebone)


Fisher, Nigel
Maitland, Sir John
Walder, David


Fletcher-Cooke, Charles
Markham, Major Sir Frank
Walker, Peter


Forrest, George
Marshall, Douglas
Walker-Smith, Rt. Hon. Sir Derek


Foster, John
Marten, Neil
Wall, Patrick


Fraser, Ian (Plymouth, Sutton)
Mathew, Robert (Honiton)
Ward, Dame Irene


Freeth, Denzil
Matthews, Gordon (Meriden)
Webster, David


Gammans, Lady
Mawby, Ray
Wells, John (Maidstone)


Gardner, Edward
Maxwelt-Hyslop, R. J.
Whitelaw, William


Glover, Sir Douglas
Maydon, Lt.-Cmdr. S. L. C.
Williams, Dudley (Exeter)


Glyn, Dr. Alan (Clapham)
Mills, Stratum
Williams, Paul (Sunderland, S.)


Glyn, Sir Richard (Dorset, N.)
Montgomery, Fergus
Wills, Sir Gerald (Bridgwater)


Godber, J. B.
More, Jasper (Ludlow)
Wilson, Geoffrey (Truro)


Goodhart, Philip
Morgan, William
Woodhouse, C. M.


Cower, Raymond
Nabarro, Gerald
Woodnutt, Mark


Grant, Rt. Hon. William
Nicholls, Sir Harmar
Woollam, John


Green, Alan
Nicholson, Sir Godfrey
Worsley, Marcus


Grimston, Sir Robert
Noble, Michael



Grosvenor, Lt.-Col. R. G.
Nugent, 8ir Richard
TELLERS FOR THE AYES:


Gurden, Harold
Oakshott, Sir Hendrie
Colonel Sir H. Harrison and


Hall, John (Wycombe)
Osborn, John (Hallam)
Mr. Finlay.


Hamilton, Michael (Wellingborough)
Osborne, Sir Cyril (Louth)





NOES


Ainsley, William
Bacon, Miss Alice
Blyton, William


Albu, Austen
Baxter, William (Stirlingshire, W.)
Boardman, H.


Allen, Scholefield (Crewe)
Bence, Cyril
Bowden, Herbert W. (Leics, S.W.)


Awbery, Stan
Benson, Sir George
Bowles, Frank







Boyden, James
Hynd, John (Attercliffe)
Roberts, Albert (Normanton)


Braddock, Mrs. E. M.
Irvine, A. J. (Edge Hill)
Roberts, Goronwy (Caernarvon)


Brockway, A. Fenner
Jay, Rt. Hon. Douglas
Robertson, John (Paisley)


Brown, Alan (Tottenham)
Jenkins, Roy (Stechford)
Robinson, Kenneth (St. Pancras, N.)


Brown, Rt. Hon. George (Belper)
Johnson, Carol (Lewisham, S.)
Rogers, G. H. R. (Kensington, N.)


Butler, Herbert (Hackney, C.)
Jones, Dan (Burnley)
Ross, William


Butler, Mrs. Joyce (Wood Green)
Jones, Jack (Rotherham)
Royle, Charles (Salford, West)


Callaghan, James
Jones, J. Idwal (Wrexham)
Shinwell, Rt. Hon. E.


Castle, Mrs. Barbara
Jones, T. W. (Merioneth)
Short, Edward


Chetwynd, George
Kelley, Richard
Silverman, Julius (Aston)


Cliffe, Michael
Kenyon, Clifford
Silverman, Sydney (Nelson)


Cronin, John
Key, Rt. Hon. C. W.
Skeffington, Arthur


Crosland, Anthony
King, Dr. Horace
Slater, Mrs. Harriet (Stoke, N.)


Crossman, R. H. S.
Lawson, George
Slater, Joseph (Sedgefield)


Cullen, Mrs. Alice
Ledger, Ron
Small, William


Davies, G. Elfed (Rhondda, E.)
Lee, Frederick (Newton)
Smith, Ellis (Stoke, S.)


Davies, Harold (Leek)
Lee, Miss Jennie (Cannock)
Sorensen, R. W.


Davies, S. O. (Merthyr)
Lewis, Arthur (West Ham, N.)
Spriggs, Leslie


de Freitas, Geoffrey
Lipton, Marcus
Steele, Thomas


Delargy, Hugh
Loughlin, Charles
Stewart, Michael (Fulham)


Diamond, John
Mabon, Dr. J. Dickson
Stones, William


Dodds, Norman
McCann, John
stross,Dr.Barnett(Stoke-on-Trent,C.)


Dugdale, Rt. Hon. John
MacColl, James
Swain, Thomas


Ede, Rt. Hon. C.
Mclnnes, James
Swingler, Stephen


Edwards, Rt. Hon. Ness(Caerphilly)
McKay, John (Wallsend)
Symonds, J. B.


Edwards, Walter (Stepney)
Mackie, John (Enfield, East)
Taylor, Bernard (Mansfield)


Evans, Albert
McLeavy, Frank
Taylor, John (West Lothian)


Fitch, Alan
MacPherson, Malcolm (Stirling)
Thomas, Iorwerth (Rhondda, W.)


Fletcher, Eric
Mallalieu, J.P.W.(Huddersfield,E.)
Thompson, Dr. Alan (Dunfermline)


Fraser, Thomas (Hamilton)
Manuel, A. c.
Thomson, G. M. (Dundee, E.)


Gaitskell, Rt. Hon. Hugh
Mapp, Charles
Thornton, Ernest


Galpern, Sir Myer
Marsh, Richard
Timmons, John


George, LadyMeganLloyd(Crmrthn)
Mendelson, J. J.
Tomney, Frank


Ginsburg, David
Milne, Edward J.
Ungoed-Thomas, Sir Lynn


Gordon Walker, Rt. Hon. P. C.
Mitchison, G. R.
Wade, Donald


Gourlay, Harry
Monslow, Walter
Wainwright, Edwin


Greenwood, Anthony
Moody, A. S.
Warbey, William


Grey, Charles
Mort, D. L.
Watkins, Tudor


Griffiths, Rt. Hon. James(Llanelly)
Moyle, Arthur
Weitzman, David


Griffiths, W. (Exchange)
Mulley, Frederick
Wells, William (Walsall, N.)


Grimond, J.
Neal, Harold
White, Mrs. Eirene


Hale, Leslie (Oldham, W.)
Noel-Baker, Francis (Swindon)
Whitlock, William


Hall, Rt. Hn. Glenvil (Colne Valley)
Oliver, G. H.
Wilkins, W. A.


Hamilton, William (West Fife)
Oram, A. E.
Willey, Frederick


Hannan, William
Owen, Will
Williams, D. J. (Neath)


Hart, Mrs. Judith
Padley, W. E.
Williams, Ll. (Abertillery)


Hayman, F. H.
Pannell, Charles (Leeds, W.)
Williams, W. R. (Openshaw)


Healey, Denis
Parker, John
Williams, W. T. (Warrington)


Hilton, A. V.
Parkin, B. T.
Willis, E. G. (Edinburgh, E.)


Holman, Percy
Pavitt, Laurence
Wilson, Rt. Hon. Harold (Huyton)


Holt, Arthur
Pearson, Arthur (Pontypridd)
Winterbottom, R. E.


Houghton, Douglas
Pentland, Norman
Woodburn, Rt. Hon. A.


Howell, Charles A. (Perry Barr)
Popplewell, Ernest
Woof, Robert


Howell, Denis (Small Heath)
Prentice, R. E.
Zilliacus, K.


Hoy, James H.
Price, J. T. (Westhoughton)



Hughes, Cledwyn (Anglesey)
Probert, Arthur
TELLERS FOR THE NOES:


Hughes, Emrys (S. Ayrshire)
Randall, Harry
Mr. Redhead and


Hunter, A. E.
Rankin, John
Dr. Broughton.


Hynd, H. (Accrington)
Reynolds, G. W.

Mr. Selwyn Lloyd: I beg to move, in page 21, line 34, to leave out from "week" to the end of line 39.
I think that all subsequent Government Amendments to this Clause, to Clause 34 and to the Fifth Schedule deal with the same matter. Perhaps what I say now may be taken to refer to them all.
When in Committee we discussed the position of Northern Ireland in relation to the employers' surcharge, I made clear that I accepted from the beginning that the Exchequer would derive no benefit from the surcharge in Northern Ireland if it were imposed. The question between us, therefore, was not one of prin-

ciple but of administration, whether it was simpler to insist that the surcharge be collected in Northern Ireland and then refunded in some way by the Northern Ireland Government or whether it was better to exclude Northern Ireland altogether from the compass of the surcharge. I undertook to look further into the administrative problem in consultation with the Government of Northern Ireland. I said that, if there were no great administrative difficulty involved, I thought I could meet the point of view expressed by my hon. Friends.
Consultations have been held. It is clear that it is not impossible to exclude


Northern Ireland from the scope of the surcharge. I do not pretend that it will be a wholly satisfactory arrangement. I think that some employers and employees, as well as the Ministries concerned, may find themselves put to a certain amount of trouble and inconvenience if the surcharge is imposed. The Government of Northern Ireland, after due consideration of what is involved, prefer, on the whole, that we should proceed on the basis of the total exclusion of Northern Ireland rather than by the method I proposed originally. In the circumstances, I propose that the matter should be dealt with in that way, and I have accordingly put down the necessary Amendments. I hope that the House will accept them.

Mr. Mitchison: I say only that I regret that the form of the Money Resolution and the rules of order do not allow us to exclude other places where there is grave unemployment.

Hon. Members: Hear, hear.

Amendment agreed to.

Further Amendments made: In page 22, line 6, leave out from beginning to "shall".

In page 22, line 9, leave out paragraph (b).—[Mr. Selwyn Lloyd.]

Mr. Jasper More: I beg to move, in page 22, line 12, at the end to insert:
and
(c) shall be treated for the purpose of subsection (2) of section three hundred and seventy-seven of the Income Tax Act, 1952, as though they were contributions paid by the employer under the National Insurance Act".
The object of the Amendment is to remove what might appear to be an unfortunate discrimination against that limited class of employers who are not entitled to make the ordinary deductions open to a trader under Schedule D. Those who have to employ their staff under Schedule A have to reclaim their expenses by a maintenance claim spread over five years, and this, of course, includes the wages of maintenance staff. The contributions which such employers pay under the National Insurance Acts, as I under stand it, are put on an equal footing with those of all other employers under the provisions of the Income Tax Acts, that is to say, they may be deducted in the year in which they are paid.
Clause 27 gives power to my right hon. and learned Friend to collect surcharges from all employers, but it seems to make no provision for putting all employers on a footing of equality in respect of the surcharge as they are in respect of contributions. I am grateful to my right hon. and learned Friend for writing to me on this matter. I think he appreciates the point I make, that the result is that those who employ estate maintenance staff and who have to make claims under Schedule A will have the surcharges spread over five years instead of being able to deduct them in the first year as ordinary traders do.
The legislation in this Clause is in the form of a power for the right hon. and learned Gentleman, and it gives him a certain latitude. Under subsection (2) of the Clause, he can choose the person in respect of whom the surcharges are to be paid, and he may fix different rates. I want to ask him, in the first place, for a clarification, for it has been publicly stated, I think I am right in saying, by a member of the Government that it is probable that this power would not, at any rate in the present year, be used in relation to agricultural workers.
The first point on which I would ask for clarification is whether this could be taken to include those other two classes of employees who are intimately associated with agriculture; namely, those who are employed in the maintenance of agricultural buildings and those who are employed by those who operate their woodlands under Schedule B. If my right hon. and learned Friend is unable to give me that assurance, I ask him to accept this Amendment, which has the object of bringing the Schedule A employers, if I may so call them, on to a basis of equality. It means treating them on the same footing as contributions under the Income Tax Acts instead of on the same footing as wages.
I suggest to my right hon. and learned Friend that what I am putting forward is both logical and just, and I express the hope that if he cannot give the assurance for which I ask he will accept the Amendment.

Sir E. Boyle: I do not think I can give the assurance for which my hon. Friend the Member for Ludlow (Mr. More) asks, because that relates to the broad policy of Clause 27, and on that I cannot add to what has been said by


my right hon. and learned Friend the Chancellor and other Ministers since the Finance Bill was first published.
I should, however, like to clear up one specific point raised in my hon. Friend's Amendment. I know that this matter has caused some concern, and I hope that what I say tonight might possibly be of some help. As I understand it, the purpose of the Amendment is that, by treating payments of surcharges like the payments of National Insurance contributions, it will give relief for surcharges paid for the tax year in which they were paid, and thus not merely accelerate relief to estate owners for surcharges paid in respect of estate staff, but also give relief to employers of domestic labour for any surcharges which they have paid.
What I would say in reply to the Amendment is that, in general, it seems to me quite logical and really essential for the whole scheme of Clause 27 that payments of surcharges should be treated for tax purposes in the same way as the wages of the staff to whom they relate. That is indeed the effect of Clause 27 and of the Fifth Schedule as drafted. I think there is clearly no justification for giving relief to domestic employers for their surcharge payments if Clause 27 is put into action. After all, a domestic employer, not being a person trading for profit, gets no tax relief on the wages he pays his housekeeper or gardener, and there is no reason why he should get tax relief for the surcharge.
I know the anxiety which my hon. Friend expresses in the case of estate owners. There are two possible grounds which could be adduced for accelerating relief to estate owners. First, there is the point that in the Bill, as drafted, he obtains relief more slowly than a trading employer; and, secondly, that the surcharges are less favourably treated than National Insurance contributions.
On the first point, that under the Bill the estate owner obtains relief more slowly, it seems to me that there is very little merit in the proposal that we should single out surcharges for exceptional treatment as compared with the other outgoings of the estate owner. In this year's Finance Bill, we have not put in a Clause relating particularly to estate owners, but we had one in last year's

Finance Bill. I cannot feel that there is a case for singling out this surcharge for exceptional treatment.
7.15 p.m.
On the second point, it is true that National Insurance contributions paid by non-trading employers receive more favourable treatment than wages. This follows the decision by Mr. Dalton—now Lord Dalton—in the 1946 Budget that all contributions to the National Insurance scheme, by whomsoever they might be made, would be treated as due deductions for Income Tax purposes.
As a counterpart to this proposal, all income benefits were to be assessed for Income Tax. I am not going into the merits of that decision now, though I am relieved to see that my hon. Friend the Member for Tynemouth (Dame Irene Ward) is not in her place, so that I can get a clear run for what I have to say. There is something in the argument for giving relief for these contributions, because, broadly speaking, these contributions go to provide benefits which are taxable; but this argument could not be used with regard to the surcharges, because they do not provide any taxable benefits.
We are not now discussing the whole object of Clause 27, but this is, after all, one of the economic regulators which, if put into force, would be designed to affect the level of purchasing power in the economy, and we are not dealing with any forms of financing of taxable benefits. This is, for this year, a surcharge on National Insurance stamps. For these reasons, I do not think it is reasonable to suggest that we should in this Bill provide for accelerating relief to estate owners, though I quite understand the anxieties which my hon. Friend expresses. He has put his case, both in correspondence and again tonight, with exemplary fairness, but I cannot advise the House to accept the Amendment. I hope that my hon. Friend will not press it, and I assure him that in all our legislation affecting tax regulators and anything else my right hon. and learned Friend will bear in mind not only the impact of this legislation on those who trade, but on estate owners and on people whose assets are in other forms as well.

Mr. More: I should like to thank my hon. Friend the Financial Secretary for replying in a way which brings it home


to us that very careful consideration has been given to this matter. My right hon. and learned Friend the Chancellor in his Budget speech made it clear that the method of levying the surcharges might be reviewed from year to year, and I only ask that the points I have put forward might be kept in consideration. I therefore beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendments made: In line 14, leave out "of the United Kingdom".

In line 19, leave out "paragraph (a) of".

In line 43, leave out subsection (7).

In page 23, line 2, leave out from "'contribution'" to end of line 4 and insert:
except where the context otherwise requires, means a contribution (other than a graduated contribution under the National Insurance Act, 1959) payable under the National Insurance Acts".

In line 7, leave out from "contributions" to end of line 8.

In line 12, leave out from "1957" to end of line 15.

In page 23, leave out lines 21 to 26.

In line 30, leave out "in their application to Great Britain".

In line 31, leave out from "1946" to end of line 33.—[Mr. Selwyn Lloyd.]

Clause 30.—(STAMP DUTY ON BILLS OF EXCHANGE AND PROMISSORY NOTES.)

Mr. Mitchison: I beg to move, in page 24, line 44, after "Kingdom", to insert:
Where the bill of exchange is payable on demand or at sight or on presentation or within three days after date or sight or where the amount or value of the money for which the bill or note is drawn or made does not exceed one hundred pounds".
Perhaps I may be allowed, at the same time, to refer to the following Amendment, also in line 44, Mr. Speaker, at the end to insert:
Where the amount or value of the money for which the bill (not being a bill of exchange payable as aforesaid) or note is drawn of—

£
s.
d


Exceeds £100 and does not exceed £500
0
2
0


Exceeds £500 and does not exceed £1,000
0
5
0


Exceeds £1,000 and does not exceed £2,000
0
10
0


Exceeds £2.000 and does not exceed £10,000
1
0
0


Exceeds £10,000
5
0
0

Provided that on a bill of exchange drawn and expressed to be payable out of the United Kingdom, when actually paid or endorsed or in any manner negotiated in the United Kingdom, the duty payable shall be one half of what would otherwise be the appropriate amount under the last foregoing table.

It is the second Amendment upon which the question which I have to raise turns. For some reason which I still find it very difficult to understand, the Chancellor this year made a concession in connection with stamps on bills of exchange, which he estimated would cost about £1½million which, after all, is not a negligible sum. When we came to the Bill, he complained that perhaps not sufficient attention had been paid to the change that he was proposing. Giving his reasons for it, he said:
It has not been the weight of this duty that has caused the trouble; it has rather been the practical difficulty for traders of keeping a supply of bills stamped with the right amount of duty, or a supply of the special adhesive stamps applying to foreign bills, and of ensuring that the right kinds of stamp are used on the different kinds of bill."—[OFFICIAL REPORT, 4th May, 1961; Vol. 639, c. 1629.]

I should remind the House that the recent very hot weather had not then broken out and, consequently, it was a question, not of the tongues or mouths of the financial tycoons who put on these bills of exchange, but of a deficiency in their powers of calculation or storage arrangements—I am not sure which. This was the reason, and I take leave to say the quite absurd reason, given for a concession costing £1½ million at a time when there are some difficulties in the country's economy.

I pointed that out in Committee, and the Financial Secretary seemed to be a little put out, first, by the reasons given by the Chancellor of the Exchequer—he did not go into those in great detail or explain exactly what had happened—and, secondly, by another very remarkable feature of the concession, which was this. The concession was to cost £1½ million. In 1959–60, the total yield of the tax was a shade over £1,400,000. It was, therefore, a sort of minus concession.

The hon. Gentleman has since kindly explained to me that the Chancellor of the Exchequer, with powers of foresight in this matter which he denies to himself in other respects, had estimated that there would have been a rather larger yield by 1961–62 at the present rates.


But he added that he did not dispute that the effect of the change would be to reduce the yield of the duty to a very small figure. If it is not a minus, it is so small that one can hardly see it. That is the result of reducing the duty to 2d. on all bills of exchange, which the Government propose to do by this Clause.

We on this side see no reason for giving away £1½ million because people are too lazy to work out the sum, or have not a cupboard in which to keep the requisite bills of exchange. When the Financial Secretary came to defend it in Committee he said that:
… the present complicated system and present duty did act as an impediment to business efficiency, and as bills of exchange are used extensively for foreign trade it was very likely that difficulties were most acutely felt there" —[OFFICIAL REPORT, 14th June, 1961; Vol. 64.2, c. 553.]
Apparently the difficulty of the tycoon in trying to find the right kind of stamp and in licking it and putting it on the bill is a serious impediment to foreign trade.

The yield of the tax is over £1 million out of the total on inland bills of exchange and promissory notes. Although I can conceive circumstances in which inland bills of exchange would be used in foreign trade, I should not have thought that they were usually used in that way. I think that the Financial Secretary must have been a little hard put to it to find a good reason for the concession. The yield from foreign bills of exchange and promissory notes amounts to just over £400,000.

One does not wish, especially in this hot weather, to put people in the City of London to any real mathematical difficulties, or to impede foreign trade by asking them to make any complicated calculations. Under the Stamp Act, the duty is graded up to 1s. on £100. After that, the duty is 1s. for each £100. If people cannot do that sum, I doubt whether they are fit to conduct any foreign business. It is absurd to suppose that that cannot be done. However, one must recognise human weakness when one meets it. Apparently, they cannot do it and that is the reason given by the Government for this concession.

These Amendments try to make things simpler for them. They will reduce the yield of the duty quite a bit.

Some concession is allowed. We voted against the whole Clause in Committee. What we suggest now is another scale with nice, large round sums—2s., 5s., 10s., £1 and £5. Therefore, the tycoons would need only five heaps of stamps and to do the simplest calculations.

It is absurd that £1½million should be given for this purpose at this moment to people who, as far as I am aware, have no particular claim to receive the money. I do not know what the Government think that they are doing or what they think of people who cannot do a simple sum and cannot keep the right stamps. A great deal of fuss has been made about a horticultural concession costing less than this and there has been a good deal of discussion about a number of other things which would have cost less than this. This quite substantial sum is given for this extraordinary purpose.

The only body which apparently made representations about it was industry. I do not know who industry is. Is there one nitwitted tycoon called "industry" who cannot do his sums? Was there a solemn deputation from the National Union of Manufacturers? I doubt whether that body would have much to do with this matter. Or were the bankers incapable of carrying out this simple operation? Who said to the Chancellor of the Exchequer, "We cannot work out 1s. per £100. We cannot keep all these stamps in our office. We cannot lick them in this hot weather. We do not know where to find them and we cannot work out the sum"?

Sir E. Boyle: The hon. and learned Member for Kettering (Mr. Mitchison) seeks, with some ingenuity, to restore in a more simple form the ad valorem duty which is at present chargeable on bills of exchange. I have had another look at this matter in the light of the criticism which the hon. and learned Gentleman made on the Committee stage. I realise that the House wishes to make progress on the Bill, but I should like to say one or two things.
First, I think that the hon. and learned Gentleman exaggerates when he spoke about the "tycoons of finance." Whatever the position may be concerning foreign bills, it is not true that the duty on bills drawn in the United Kingdom—they account for over two-thirds of the duty on all


bills—falls on the banks and discount houses. These bills have to be stamped by the person by whom they are drawn. He is normally a manufacturer or a merchant who often may be an exporter as well. I therefore think that the hon. and learned Member's reference to the tycoons of finance in this context was a little exaggerated.
I now turn to the practical difficulties under the present system which the Clause seeks to repeal. I do not want to make too much of this, but these are some of the considerations which weighed with my right hon. and learned Friend the Chancellor of the Exchequer when he was considering this matter. The first was that inland bills must be stamped with special appropriated impressed stamps and, in view of the unlimited range of the duty, it has been impossible for the regular user of such bills, cir, indeed, for Post Offices, to maintain a comprehensive range of stamped bills. If a bill user wants a bill which the Post Office does not hold in stock, it has to be requisitioned from London. Similar difficulties have arisen in relation to foreign bills.
I spoke about industry on the Committee stage. There has also been difficulty here from the point of view of the Revenue Department. The use of appropriated impressed stamps for inland bills means that stamping machines have had to be devoted exclusively to the stamping of bills and notes and could not be used for general stamping purposes at times of pressure. Stamp offices and post offices have had to maintain stocks of special stamps and bills, with all the attendant work of stocktaking and security.
7.30 p.m.
In Committee, the hon. Member for Glasgow, Craigton (Mr. Milian), who, to my regret, we have missed from our proceedings during the last day or two, said that
bills of exchange are perfectly valid even if not stamped, and the fact that they are not stamped does not invalidate them if it comes to a question, for example, of founding a legal action on them. It is a question of paying the

penalty and ensuring that they are properly stamped."—[OFFICIAL REPORT, 14th June, 1961; Vol. 642, c. 555.]

I am assured that that is not correct so far as inland bills are concerned. Under the existing law, the general rule is that inland bills must be stamped with the appropriate stamp before execution. If they are not so stamped, they are not enforceable and the defect cannot be remedied by subsequent stamping.

The hon. and learned Member for Kettering has proposed a simplified scale. A simplified scale would produce difficulties of its own. The difficulty about it is that the steps proposed are so large that considerable sums of duty could be avoided by drawing two or more bills where one would normally be drawn. Under the hon. and learned Gentleman's scheme, a bill for £150 would be liable for 2s. duty, but two bills each for £75 would be liable to a total duty of 4d. With this simplified scheme, there could be avoidance on a quite big scale and the whole system would come into disrepute.

Having looked at the matter again, I believe that an ad valorem duty based on instruments used daily in the ordinary course of business of manufacturers and merchants has no place in our modern world. Where the manufacturers and merchants are to a considerable extent engaged in the export trade, the objections to an ad valorem duty are still further strengthened. Therefore, I must advise the House not to accept the Amendment, hut to recognise the concession which my right hon. and learned Friend is making as a perfectly reasonable concession both to the business and manufacturing world and to the revenue Departments and the Post Office as well.

Mr. Mitchison: This shows how hard it is to help the tycoons. None the less, we think that the Clause ought not to be here, and the best we can do is to vote for this modification of it.

Question put, That those words be there inserted in the Bill:—

The House divided: Ayes 174, Noes 224.

Division No. 242.]
AYES
[7.32 p.m.


Ainsley, William
Baxter, William (Stirlingshire, W.)
Bowden, Herbert W. (Leics, S.W.)


Albu, Austen
Bence, Cyril
Bowles, Frank


Allen, Scholefield (Crewe)
Benson, Sir George
Boyden, James


Awbary, Stan
Blyton, William
Braddock, Mrs. E. M.


Bacon, Miss Alice
Boardman, H.
Brockway, A. Fenner




Broughton, Dr. A. D. D.
Irvine, A. J. (Edge Hill)
Probert, Arthur


Brown, Alan (Tottenham)
Jay, Rt. Hon. Douglas
Randall, Harry


Brown, Rt. Hon. George (Belper)
Jenkins, Roy (Stechford)
Rankin, John


Butler, Herbert (Hackney, C.)
Johnson, Carol (Lewisham, S.)
Reynolds, G. W.


Butler, Mrs. Joyce (Wood Green)
Jones, Rt. Hn. A. Creech(Wakefield)
Roberts, Albert (Normanton)


Callaghan, James
Jones, Dan (Burnley)
Roberts, Goronwy (Caernarvon)


Castle, Mrs. Barbara
Jones, Jack (Rotherham)
Robertson, John (Paisley)


Chetwynd, George
Jones, J. Idwal (Wresham)
Ross, William


Cliffe, Michael
Jones, T. W. (Merioneth)
Royle, Charles (Salford, West)


Cronin, John
Kelley, Richard
Short, Edward


Crosland, Anthony
Kenyon, Clifford
Silverman, Julius (Aston)


Crossman, R. H. S.
Key, Rt. Hon. C. W.
Silverman, Sydney (Nelson)


Cullen, Mrs. Alice
King, Dr. Horace
Skeffington, Arthur


Davies, G. Elfed (Rhondda, E.)
Lawson, George
Slater, Mrs. Harriet (Stoke, N.)


Davies, Harold (Leek)
Ledger, Ron
Slater, Joseph (Sedgefield)


Davies, S. O. (Merthyr)
Lee, Frederick (Newton)
Small, William


Delargy, Hugh
Lee, Miss Jennie (Cannock)
Smith, Ellis (Stoke, S.)


Diamond, John
Lewis, Arthur (West Ham, N.)
Sorensen, R. W.


Dodds, Norman
Lipton, Marcus
Spriggs, Leslie


Dugdale, Rt. Hon. John
Loughlin, Charles
Steele, Thomas


Ede, Rt. Hon. C.
Mabon, Dr. J. Dickson
Stewart, Michael (Fulham)


Edwards, Rt. Hon. Ness (Caerphilly)
McCann, John
Stones, William


Evans, Albert
MacColl, James
Swain, Thomas


Fitch, Alan
Mclnnes, James
Swingler, Stephen


Fletcher, Eric
McKay, John (Wallsend)
Symonds, J. B.


Fraser, Thomas (Hamilton)
Mackie, John (Enfield, East)
Taylor, Bernard (Mansfield)


Gaitskell, Rt. Hon. Hugh
McLeavy, Frank
Taylor, John (West Lothian)


Galpern, Sir Myer
MacPherson, Malcolm (Stirling)
Thomas, Iorwerth (Rhondda, W.)


George,LadyMeganLloyd(Crmrthn)
Mallalieu, J.P.W.(Huddersfield,E.)
Thompson, Dr. Alan (Dunfermline)


Ginsburg, David
Manuel, A. C.
Thomson, G. M. (Dundee, E.)


Gordon Walker, Rt. Hon. P. C.
Mapp, Charles
Thornton, Ernest


Gourlay, Harry
Marsh, Richard
Timmons, John


Greenwood, Anthony
Mendelson, J. J.
Tomney, Frank


Grey, Charles
Milne, Edward J.
Ungoed-Thomas, Sir Lynn


Griffiths, Rt. Hon. James (Llanelly)
Mitchison, G. R.
Warbey, William


Griffiths, W. (Exchange)
Monslow, Walter
Watkins, Tudor


Hale, Leslie (Oldham, W.)
Moody, A. S.
Weitzman, David


Hall, Rt. Hn. Glenvil (Colne Valley)
Mort, D. L.
Wells, William (Walsall, N.)


Hamilton, William (West Fife)
Moyle, Arthur
White, Mrs. Eirene


Hannan, William
Mulley, Frederick
Whitlock, William


Hart, Mrs. Judith
Neal, Harold
Wilkins, W. A.


Hayman, F. H.
Noel-Baker, Francis (Swindon)
Willey, Frederick


Healey, Denis
Oliver, G. H.
Williams, D. J. (Neath)


Hilton, A. V.
Oram, A. E.
Williams, Ll. (Abertillery)


Holman, Percy
Oswald, Thomas
Williams, W. R. (Openshaw)


Houghton, Douglas
Padley, W. E.
Williams, W. T. (Warrington)


Howell, Charles A. (Perry Barr)
Pannell, Charles (Leeds, W.)
Willis, E. G. (Edinburgh, E.)


Howell, Denis (Small Heath)
Parker, John
Wilson, Rt. Hon. Harold (Huyton)


Hoy, James H.
Pavitt, Laurence
Winterbottom, R. E.


Hughes, Cledwyn (Anglesey)
Pearson, Arthur (Pontypridd)
Woodburn, Rt. Hon. A.


Hughes, Emrys (S. Ayrshire)
Pentland, Norman
Woof, Robert


Hunter, A. E.
Popplewell, Ernest



Hynd, H. (Accrington)
Prentice, R. E.
TELLERS FOR THE AYES:


Hynd, John (Attercliffe)
Price, J. T. (Westhoughton)
Mr. Redhead and




Mr. G. H. R. Rogers.




NOES


Agnew, Sir Peter
Carr, Robert (Mitcham)
Emery, Peter


Aitken, W. T.
Channon, H. P. G.
Erroll, Rt. Hon. F. J.


Allason, James
Chataway, Christopher
Farey-Jones, F. W.


Arbuthnot, John
Chichester-Clark, R.
Farr, John


Ashton, Sir Hubert
Clark, William (Nottingham, S.)
Finlay, Graeme


Barber, Anthony
Clarke, Brig. Terence (Portsmth, W.)
Fisher, Nigel


Barlow, Sir John
Cleaver, Leonard
Fletcher-Cooke, Charles


Barter, John
Cole, Norman
Fraser, Ian (Plymouth, Sutton)


Bell, Ronald
Cooper, A. E.
Freeth, Denzil


Bennett, F. M. (Torquay)
Cooper-Key, Sir Neill
Gammans, Lady


Berkeley, Humphry
Cordeaux, Lt.-Col. J. K.
Gardner, Edward


Bidgood, John C.
Cordle, John
Glyn, Dr. Alan (Clapham)


Bingham, R. M.
Corfield, F. V.
Glyn, Sir Richard (Dorset, N.)


Birch, Rt. Hon. Nigel
Courtney, Cdr. Anthony
Godber, J. B.


Bishop, F. P.
Craddock, Sir Beresford
Goodhart, Philip


Black, Sir Cyril
Critchfey, Julian
Gower, Raymond


Bourne-Arton, A.
Cunningham, Knox
Grant, Rt. Hon. William


Box, Donald
Curran, Charles
Green, Alan


Boyd-Carpenter, Rt. Hon. John
Currie, G. B. H.
Grimond, J.


Boyle, Sir Edward
Dalkeith, Earl of
Grosvenor, Lt.-Col. R. G.


Brewis, John
Deedes, W. F.
Gurden, Harold


Brooman-White, R.
Donaldson, Cmdr. C. E. M.
Hall, John (Wycombe)


Bryan, Paul
Doughty, Charles
Hamilton, Michael (Wellingborough)


Buck, Antony
du Cann, Edward
Harris, Frederic (Croydon, N.W.)


Bullard, Denys
Duncan, Sir James
Harris, Reader (Heston)


Burden, F. A.
Eden, John
Harrison, Col. Sir Harwood (Eye)


Butler, Rt.Hn.R.A.(Saffron Walden)
Elliot, Capt. Walter(Carshalton)
Harvey, John (Walthamstow, E.)


Campbell, Gordon (Moray &amp; Nairn)
Elliott,R.W.(Nwcstle-upon-Tyne,N.)
Harvie Anderson, Miss







Heald, Rt. Hon. Sir Lionel
Markham, Major Sir Frank
Skeet, T. H. H.


Henderson, John (Cathcart)
Marshall, Douglas
Smith, Dudley (Br'ntf'rd &amp; Chiswick)


Henderson-Stewart. Sir James
Marten, Neil
Smithers, Peter


Hicks Beach, Maj. W.
Mathew, Robert (Honiton)
Spearman, Sir Alexander


Hiley, Joseph
Matthews, Cordon (Meriden)
Speir, Rupert


Hill, Mrs. Eveline (Wythenehawe)
Mawby, Ray
Stevens, Geoffrey


Hill, J. E. B. (S. Norfolk)
Maxwell-Hyslop, R. J.
Storey, Sir Samuel


Hirst, Geoffrey
Maydon, Lt.-Cmdr. S. L. C.
Studholme, Sir Henry


Hobson, John
Montgomery, Fergus
Summers, Sir Spencer (Aylesbury)


Hocking, Philip N.
More, Jasper (Ludlow)
Talbot, John E.


Holland, Philip
Morgan, William
Tapsell, Peter


Hollingworth, John
Nabarro, Gerald
Taylor, Sir Charles (Eastbourne)


Holt, Arthur
Nicholls, Sir Harmar
Taylor, Edwin (Bolton, E.)


Hopkins, Alan
Nicholson, Sir Godfrey
Teeling, William


Howard, John (Southampton, Test)
Nugent, Sir Richard
Temple, John M.


Hughes-Young, Michael
Oakshott, Sir Hendrie
Thatcher, Mrs. Margaret


Hulbert, Sir Norman
Osborn, John (Hallam)
Thomas, Leslie (Canterbury)


Hutchison, Michael Clark
Osborne, Sir Cyril (Louth)
Thomas, Peter (Conway)


Iremonger, T. L.
Page, John (Harrow, West)
Thompson, Kenneth (Walton)


Irvine, Bryant Godman (Rye)
Page, Graham (Crosby)
Thornton-Kemsley, Sir Colin


Jackson, John
Partridge, E.
Tiley, Arthur (Bradford, W.)


James, David
Pearson, Frank (Clitneroe)
Turner, Colin


Jenkins, Robert (Dulwich)
Peel, John
Turton, Rt. Hon. R. H.


Jennings, J. C.

Tweedsmuir, Lady


Johnson, Dr. Donald (Carlisle)
Peyton, John
van Straubenzee, W. R.


Johson, Eric (Buckley)
Pickthorn, Sir Kenneth
Vaughan-Morgan, Rt. Hon. Sir John


Kaberry, Sir Donald
Pikington, Sir Richard
Vosper, Rt. Hon. Dennis


Lagden, Godfrey
Pitman, Sir James
Wakefield, Sir Wavell (St. M'lebone)


Leather, E. H. C.
Pitt, Miss Edith
Walder, David


Leavey, J. A.
Pott, Percivall
Walker, Peter


Lewis, Kenneth (Rutland)
Price, David (Eastleigh)
Walker-Smith, Rt. Hon. Sir Derek


Lindsay, Martin
Prior-Palmer, Brig. Sir Otho
Wall, Patrick


Litchfield, Capt. John
Proudfoot, Wilfred
Ward, Dame Irene


Lloyd, Rt. Hon. Selwyn (Wirral)
Quennell, Miss J. M.
Webster, David


Loveys, Walter H.
Redmayne, Rt. Hon. Martin
Wells, John (Maidstone)


Lucas, Sir Jocelyn
Rees, Hugh
Whitelaw, William


Lucas-Tooth, Sir Hugh
Rees-Davis, W. R.
Williams, Dudley (Exeter)


McAdden, Stephen
Renton, David
Williams, Paul (Sunderland, S.)


Mac Arthur, Ian
Ridley, Hon. Nicholas
Wills, Sir Gerald (Bridgwater)


McLaughlin, Mrs. Patricia
Ridsdale, Julian
Wilson, Geoffrey (Truro)


Maclay, Rt. Hon. John
Robson Brown, Sir William
Wolrige-Gordon, Patrick


Maclean,SirFitroy (Bute&amp;N.Ayrs.)
Roots, William
Woodhouse, C M.


Macleod, Rt. Hn. Iain (Enfield, W.)
Ropner, Col. Sir Leonard
Woodnutt, Mark


MacLeod, John (Ross &amp; Cromarty)
Royle, Anthony (Richmond, Surrey)
Woollam, John


McMaster, Stanley R.
Russell, Ronald
Worsley, Marcus


Maddan, Martin
Scott-Hopkins, James



Maginnis, John E.
Seymour, Leslie
TELLERS FOR THE NOES:


Maitland, Sir John
Shaw, M.
Mr. Gibson-Watt and Mr. Noble

Clause 34.—(SHORT TITLE, INTERPRETATION, CONSTRUCTION, EXTENT AND REPEAL.)

Amendment made: In page 29, line 5, leave out from beginning to "such" in line 6.—[Mr. Barber.]

First Schedule.—(SUPPLEMENTARY PROVISIONS AS TO TELEVISION ADVERTISEMENT DUTY.)

Mr. Barber: I beg to move, in page 30, line 20, to leave out "fifteen" and to insert "twenty-five".

Mr. Speaker: I think that it would be convenient to take also the next Amendment in line 21, to leave out "fifteen" and to insert "twenty-five".

Mr. Barber: The House will remember that the First Schedule provides that the duty in respect of advertisements broadcast in any month after the passing of the Bill is to be payable by the pro-

gramme contractor to the Crown within 15 days of the end of that month. The Amendments substitute a period of 25 days. They are intended to meet the point raised by my hon. Friends the Member for Crosby (Mr. Graham Page) and the Member for Perth and East Perthshire (Mr. MacArthur) in Committee. When they raised the matter I promised to consider it and I hope that the extension from 15 to 25 days will meet the point which they then made.

Mr. Graham Page: I thank my hon. Friend for the Amendments. They recognise normal commercial practice and I am sure that the Schedule will work much more smoothly with 25 instead of 15 days.

Amendment agreed to.

Further Amendment made: In page 30, line 21, leave out "fifteen" and insert "twenty-five".—[Mr. Barber.]

Third Schedule.—(SUPPLEMENTARY PROVISIONS AS TO ORDERS UNDER SS. 8 AND 27.)

Mr. Selwyn Lloyd: I beg to move, in page 34, line 43, to leave out "twenty-eight" and to insert "twenty-one".

Mr. Speaker: I think that it would be convenient, indeed necessary, for the House to discuss with this Amendment the next three Amendments in line 43, to leave out "twenty-eight" and to insert "fourteen"; in line 44, to leave out "twenty-eight" and to insert "twenty-one", and in line 44, to leave out "twenty-eight" and to insert "fourteen".

Mr. Lloyd: The suggestion is that the period should be 21 days rather than 28 days within which the House has to approve the use of the regulators. I think that in this matter we must bear in mind not only the convenience of the Government, but also the convenience of the Opposition. When one considers that this might be happening in the Recess, when hon. Members might be dispersed, I think that it is reasonable and would be convenient to both Government and Opposition to make the time 21 days.

7.45 p.m.

Mr. Mitchison: The history of this matter is that the Bill provided for 28 days during which one of the regulators could be in force before being confirmed by Parliament. The Opposition tabled an Amendment in Committee suggesting seven days, which was perhaps a bit of a bargaining Amendment. We have now tabled two Amendments, which you have mentioned, Mr. Speaker, suggesting 14 days and the Chancellor has conceded 21 days. We think that on the whole this somewhat "higgling market" procedure is now concluded and that the right hon. and learned Gentleman's Amendments, for the reasons given, meet the convenience of all concerned.

Amendment agreed to.

Further Amendment made: In page 34, line 44, leave out "twenty-eight" and insert "twenty-one".—[Mr. Selwyn Lloyd.]

Fourth Schedule.—(PROVISIONS AS TO SPECIAL CASES FALLING WITHIN S. 8.)

Mr. Barber: I beg to move, in page 35, line 39, at the end to insert:
6.—In subsection (2) of section two hundred of the Act of 1952 (repayment of rebate on use of rebated heavy oils as vehicle fuel) for the words "the rebate on like oils at the rate for the time being in force" there shall be substituted the words "the amount for the time being allowable in respect of rebate on like oils"; and in subsection (1) of section two hundred and eight of that Act (rebate to be repaid before rebated heavy oils mixed with light oils) for the words "the rebate allowed" there shall be substituted the words "the amount allowed in respect of rebate".
The purpose of the Amendment is to correct two small and related technical flaws in the provisions which govern the Customs and excise regulator. It does not affect the substance of the provisions which we considered in Committee and I hope, therefore, that the House will accept it.

Amendment agreed to.

Mr. Barber: I beg to move, in page 35, line 44, after "gear)", to insert:
and section (Relief from duty on heavy oils used by horticultural producers) of this Act".
This Amendment is consequential on the new Clause giving relief from duty on heavy oils used by horticultural producers.

Amendment agreed to.

Fifth Schedule.—(SUPPLEMENTARY PROVISIONS AS TO SURCHARGES ON EMPLOYERS.)

Amendments made: In page 36, line 5, leave out from "Acts" to the first "as" in line 6.

In line 19, leave out from "contributions" to "or" in line 20.

In line 27, leave out from "Fund" to "of" in line 29 and insert:
shall apply in relation to the recovery".

In line 33, leave out from the first "Acts" to "or" in line 34.

In line 35, leave out "under those Acts".

In line 36, leave out from "Fund" to "shall" in line 37.

In line 44, leave out from beginning to "and" in line 49.

In page 37, line 1, leave out from first "Acts" to end of line.—[Mr. Barber.]

Sixth Schedule.—(REPEALS.)

Sir E. Boyle: I beg to move, in page 37, line 26, column 3, at the beginning to insert:
In section thirty-two, the words "the expression 'bill of exchange payable on demand' includes" and in paragraph (b) the words from "and sent" to the end.
This Amendment corrects an omission in Part II of the Sixth Schedule which covers the Stamp Duty repeals. The head of charge Bill of exchange payable on demand" is being repealed by Section 30 (1) of the Bill, and all other existing references to bills of exchange payable on demand are also being repealed by the Schedule. The Schedule, however, does not at present repeal the definition of bill of exchange payable on demand" in Section 32 of the Stamp Act, 1891. It is clearly wrong to retain this definition. The Amendment accordingly repeals it.
I doubt whether anybody in the House —I am not sure that even the hon. Member for Kilmarnock (Mr. Ross), unless he were very well up in the 1891 Act—would have noticed this point. A constituent of my hon. Friend the Member for Southport (Mr. Percival) drew my attention to this matter. Quite clearly, on the merits of the case, he was right and it was only right to table the Amendment.

Mr. Mitchison: I am glad to know that the Government have one intelligent supporter.

Amendment agreed to.

Bill to be read the Third time Tomorrow and to be printed [Bill 148].

Orders of the Day — FLOOD PREVENTION (SCOTLAND) BILL

Lords Amendments considered.

Clause 2.—(POWERS OF LOCAL AUTHORITIES.)

Lords Amendment: In page 2, line 3, leave out "major".

7.50 p.m.

The Joint Under-Secretary of State for Scotland (Mr. T. G. D. Galbraith): I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment meets an undertaking which I gave during the recommittal stage of the Bill.

Mr. William Ross: This takes us a long way back. I am reminded of the popular chorus—"It is a long, long time". It is about five months since we parted with the Bill, and if during the watches of the evening we regain some of its content the hon. Gentleman should not be surprised.
If I remember rightly, this provision was related to an Amendment which the Government proposed in the expectation that it would receive an enthusiastic response from the Opposition. They thought that it would meet the suggestion which we had made. However, because of the strange lure of language they inserted the word "major", which deprived local authorities of a certain amount of grant. They have now seen fit to correct that error and we are glad that they have done so.

Question put and agreed to.

Clause 3.—(SUPPLEMENTARY PROVISIONS AS TO POWERS OF LOCAL AUTHORITIES.)

Lords Amendment: In page 3, line 37, at end insert:
(4) Nothing in the foregoing provisions of this Act relating to maintenance and management operations shall authorise the carrying out by a local authority of any such operations so as to affect injuriously any works or property belonging to, or the carrying on of their statutory undertaking by, any statutory undertakers, except with the consent in writing of the statutory undertakers:
Provided that consent for the purposes of this subsection shall not be required if it is withheld unreasonably, and any question whether any such consent has been withheld unreasonably shall be referred to and determined by the Secretary of State.

Mr. Galbraith: I beg to move, That this House doth agree with the Lords in the said Amendment.
The purpose of the Amendment is to ensure that statutory undertakers, such as docks and harbours and railways and canal authorities, should have an opportunity to advise on any maintenance and management operations likely to affect their interests. Operations under flood prevention schemes are already covered by the procedure of the Second Schedule, but, as the Bill stands, a local authority can carry out maintenance and management operations simply by giving due notice of entry. Under the Amendment, local authorities will be required to consult the statutory undertaking concerned, and any disputes can be settled by the Secretary of State for Scotland. Local authorities are familiar with the procedure and there is ample precedent for the provision.

Mr. Ross: This is something entirely new. The strange thing is that there was no discussion on this issue even in another place. It passed without comment. The Government owe the House an explanation of why it was not until the very last lap on Report in another place that the Government saw fit to make this Amendment.
I am not entirely convinced of the need for it. The Amendment is strictly limited to maintenance and management operations. That presupposes that there are watercourse barriers and the ancillary apparatus to be maintained. Statutory undertakers already know of the existence of such things and must know that they have to be maintained. We then have to appreciate what is to be done about cleansing and repairing and otherwise maintaining in what are relatively minor operations, matters which throughout our discussions in Committee and on Report the hon. Gentleman spoke of as routine matters. One wonders why we now need a subsection devoted to safeguarding the interests of statutory undertakers when those safeguards are not given to others with interests in the same maintenance operations.
The new subsection uses the words:
…so as to affect injuriously any works or property belonging to…
Those are important words. They mean that a local authority has to have the

written consent of a statutory undertaker before carrying out this work. If there is any disagreement between the two, we bring in the Lord High Commissioner himself, the Secretary of State for Scotland, the great centraliser, the approver, the disapprover and everything else for what goes on in the life and living of the people of Scotland.
Why is this provision necessary when we already have existing safeguards? Due notice has to be given. If at any time a local authority wants to enter anybody's land, whether that of a statutory undertaker or not, fourteen days' notice has to be given. There is no right as such to walk on to somebody's land and begin operations. If the person concerned is not satisfied, the sheriff adjudicates on whether the request for entry is reasonable.
Another safeguard for the interests of statutory undertakers, as for anybody else, is that if the authority does anything wrong it has to pay compensation. Thus, there are already three safeguards applying to statutory undertakers and to everybody else. I would have thought that that was sufficient without segregating the statutory undertakers and giving them additional protection.
Who are the statutory undertakers? I do not suppose that docks and harbours come into the matter, because they are already covered by the provisions dealing with coast protection. We are dealing with railways and with electricity and gas boards. We are making a mountain out of a molehill by dragging in this subsection, especially since it has had so in adequate an explanation. The last thing to be done is to drag in the Secretary of State. He is busy with other things and there is no reason why he should adjudicate on the issue of withholding permission.
The time factor might arise and the authority concerned might want to get on to the work quickly. If it has to go through all this routine, some of the provisions safeguarding emergency action will be destroyed. Has the Under-Secretary even thought of the effect on emergency cases? Is this right to be given in respect of an emergency case?
It would have been better if the Amendment had been suggested earlier when it could have been discussed in Committee so that we could have made it


possibly more workable, as we have done with other provisions. I hope that the Lord Advocate or the Joint Under-Secretary will be able to persuade us that what is being done is justified.

Mr. E. G. Willis: Surely the hon. Gentleman will reply to the cogent arguments of my hon. Friend the Member for Kilmarnock (Mr. Ross), who asked a number of questions deserving some reply. I agreed with a great deal of what he said, although I was not certain that I went all the way with him. There might be cases where maintenance of a canal, for instance, might affect mines, for instance. However, my hon. Friend asked a number of questions concerning the other safeguards which affect statutory undertakers as they affect others. As those safeguards are applicable to everyone concerned, we ought to be given some reason why it was thought necessary to have a special subsection to cover statutory undertakers.

Mr. Galbraith: By leave of the House, I did not rise before, because I did not want to deprive the hon. Member for Edinburgh, East (Mr. Willis) of the opportunity, which he clearly desired, of raising his voice.
The hon. Member for Kilmarnock (Mr. Ross) suggested that we were making a mountain out of a molehill, but I suggest that he is. Local authorities are responsible bodies and will act responsibly in these matters. They are not likely to undertake maintenance operations in a way which would adversely affect statutory undertakers without having consulted them. However, one must be careful because there may be specialised technical problems—for example, a culvert under a railway which is the responsibility of the statutory undertaking—where it is clearly desirable that there should be the closest liaison between the local authority and those who have intimate knowledge of the problems concerned. It is only to provide that liaison that the Amendment has been put forward. I hope that that explanation will satisfy the hon. Gentleman that there is no suspicious or ulterior motive behind the Amendment.

Mr. Ross: If the culvert or bridge were the responsibility of the statutory undertaker, it would not be covered, because

we are here dealing with watercourses which are at present not maintained by anyone and which are not anybody's responsibility. It would still be the responsibility of the statutory undertaking to keep it cleansed and so on.

Question put and agreed to.

Clause 4.—(FLOOD PREVENTION SCHEMES.)

Lords Amendment: In page 4, line 7, at end insert:
and, where in connection with any such operations it is intended that operations for the diversion of a sewer or a water-main shall he carried out by a sewerage or water authority (whether a different authority from the local authority or not, the scheme shall also specify those last-mentioned operations.

8.0 p.m.

Mr. Galbraith: I beg to move, That this House doth agree with the Lords in the said Amendment.
The purpose of this Amendment is to facilitate the reading and understanding of the Bill by those who have to operate it. It is perhaps a disadvantage that it is necessary or it would be necessary without this Amendment to go as far as Clause 12 before it became evident that work on sewers and water mains came within the scope of the Bill. I am anxious to avoid any possible misunderstanding and this Amendment has been introduced virtually as a signpost in Clause 4 indicating what is to follow in Clause 12 about sewers and water mains.
I am grateful to the two hon. Members who suggested this Amendment. I think that it will be helpful to those who have to read and deal with the Bill.

Mr. Willis: I thank the Joint Under-Secretary for having heeded our words of wisdom during the Report stage, although he will recall that he was not very favourably disposed to those words of wisdom at that time and practically ignored them. I do not think that he even promised us at the time that he would look at our suggestion. He treated it in a sort of off-hand discourteous manner that in coming from my hon. Friend the Member for Kilmarnock (Mr. Ross) and the hon. Member for Edinburgh, East (Mr. Willis) it was not worth bothering about.
I am glad that the hon. Gentleman has now had the wisdom to see that


it is worth while. If he would look at our suggestions rather more thoroughly I am sure that he would find much more in them than he thinks there is. I hope that this will be a sort of precedent that he will in future give our suggestions the consideration they deserve. I am sure that, if he does that, all his Bills will be improved, as this one is by the addition of these words.

Mr. Ross: We should be grateful to the Joint Under-Secretary or to someone else who takes the trouble to read what we say even though at the time the Joint Under-Secretary did not think there was any great merit in what we had to say. The question of sewers was one of the matters that got him rather heated during the discussion of the Bill. We were very interested indeed to hear him say that local authorities were very responsible people. It was in relation to this Clause and the subject of sewers, that he talked about unscrupulous local authorities trying to get an extra £ or two from the Secretary of State for Scotland. We are grateful for this belated acceptance of our suggestion and that he has heeded the advice of my hon. Friend the Member for Edinburgh, East (Mr. Willis), who made this suggestion during the Report stage. He tried to get the hon. Gentleman to put something into Clause 2, but my hon. Friend was brushed off on that occasion. This belated acceptance heartens us, and we look forward to a repetition of this process on other Bills.

Question put and agreed to.

Clause 12.—(CONTRIBUTIONS TO AND BY LOCAL AUTHORITIES.)

Lords Amendment: In page 8, line 17, at the end to insert:
(2) Where a local authority are a sewerage or water authority and as such incur expenditure in carrying out, or paying compensation in respect of, any operations such as are specified in paragraph (b) of the foregoing subsection in relation to a flood prevention scheme made by themselves, they may appropriate to the accounts of their sewerage, or, as the case may be, water, undertaking such sum as they think fit in respect of that expenditure; and any such appropriation shall be deemed to be a contribution under this section towards the expenditure.

Mr. Galbraith: I beg to move, That this House doth agree with the Lords in the said Amendment.
The Clause as it stands permits the flood prevention authority to arrange with the sewerage or water authority to divert a sewer or water main which is causing an obstruction and likely to cause flooding. As part of this arrangement the flood prevention authority may make a contribution towards the expenditure incurred by the sewerage or water authority in carrying out the work.
I am advised that without specific provision in the Bill there may be legal doubt about the right of the flood prevention authority to make a contribution to the sewerage or water authority where that authority happens to be a department of the same parent authority as the flood prevention authority itself; in other words, where a single authority is carrying out a separate function as a flood prevention authority and as a sewerage and water authority.
I am told that it might be held that any adjustment of a local authority's accounts in such circumstances could not properly be held as a contribution for the purpose of the Bill and that, accordingly, the expenditure would not rank for grant. It is important that any doubt on this point should be removed and as the Amendment will have that effect I hope that it will commend itself to the House.

Mr. Ross: Can the Joint Under-Secretary tell us exactly what is meant by
paragraph (b) of the foregoing subsection"?

Mr. Galbraith: I understand that paragraph (b) of the foregoing subsection does not appear in the copy of the Bill that we are looking at now, but it is in Bill (45), where these two Amendments (a) and (b) are drafting Amendments.

Mr. Thomas Fraser: We can only work on the Bill that is provided for us in the House. In the copy of the Bill before us, I see that Clause 12 appears on page 8 as two subsections. The Amendment now before the House proposes to put in an additional subsection which is to become subsection (2). Subsection (2) will read as follows:
Where a local authority are a sewerage or water authority and as such incur expenditure in carrying out, or paying compensation in


respect of, any operations such as specified in paragraph (b) of the foregoing subsection…
On looking at subsection (1) of the foregoing subsection, I find that there is no paragraph (a) or (b). I cannot understand the Joint Under-Secretary saying that if we look at another edition of the Bill (45), we shall see that there was paragraph (a) and paragraph (b). The authorities of the House provide us with copies of the Bill for the purpose of our discussion.
There are no paragraphs (a) and (b) in in the copy of the Bill which we have. How on earth can we do our work properly if we are referred to a copy of the Bill which apparently does not exist or is not available to hon. Members? I do not know whether the Joint Under-Secretary has taken the point, but I should be obliged if he would put us in possession of the facts and the circumstances which led to hon. Members being put in possession of a Bill which apparently is not the Bill that we are seeking to amend.

Mr. Willis: This is another example of Government ineptitude. I obtained my copy of the Bill from the Vote Office about half an hour ago. There is certainly no
paragraph (b) of the foregoing subsection
in it.
As my hon. Friend the Member for Hamilton (Mr. T. Fraser) has said, how can we be expected to understand what this means unless we have the appropriate Bill in our possession? My Bill is No. (29). If there has been another printing of the Bill, No. (45), surely it is incumbent on the Government to have withdrawn this copy and put copies of Bill No. (45) in the Vote Office.

Mr. A. C. Manuel: I have just obtained my copy and it is still No. (29).

Mr. Ross: It is even worse than that. On the Notice Paper containing the Lords Amendments to the Flood Prevention (Scotland) Bill with which we are dealing there is a note which says:
The page and line, refer to Bill (29) as first printed by the Lords.

Mr. Willis: My hon. Friend is quite correct. At the top of the Notice Paper

referring to the Bill to which we are now seeking to agree the Lords Amendments, it says:
The page and line refer to Bill (29) as first printed by the Lords.
We have Bill (29) and there is no paragraph (a). I have been handed a copy of the Flood Prevention (Scotland) Bill as amended on Report, which is No. (45). So, apparently, there must have been some hasty work on the part of the Scottish Office and this copy has been rushed to the Vote Office.
This Bill left this House nearly six months ago. There has been a gross mismanagement of business on the part of the Government who have not brought this Bill here before now. In view of the very long time which has elapsed, I should have thought that there is still less excuse for the Government having made this hopeless blunder than would have been the case had they proceeded with the Bill at their customary speed and passed it some time before Easter.
We have waited a long time for the Bill and as a result of waiting all we have is muddle, incompetence and ineptitude. It is about time that the Secretary of State thought about—I was going to say resigning. Hon. Gentlemen opposite may laugh, but it is disgraceful that a simple bit of Government business cannot be put through the House without this running to and fro from the Treasury Box and the Government Front Bench to the Vote Office. Here we are discussing something which is not in the Bill at all. I think the hon. Gentleman ought to give us a good explanation and be most apologetic for the great inconvenience he has caused.

Mr. Ross: On a point of order, Mr. Deputy-Speaker. I should like your help about this matter. We have before us Lords Amendments to the Flood Prevention (Scotland) Bill. It states on the Notice Paper containing the Amendments:
The page and line refer to Bill (29) as first printed by the Lords.
If we refer to page 8, line 17, as was suggested by the Joint Under-Secretary, we get absolute nonsense. Surely, in dealing with our business in this House we have not reached the stage where we must have two copies, two different printings, of a Bill in order to understand what the Amendments are about. Bill


No. (45), which I presume is the Bill which was last printed, was ordered to be printed on 14th March.

8.15 p.m.

Mr. Willis: Months ago.

Mr. Ross: The Lords Amendments to the Flood Prevention (Scotland) Bill were ordered to be printed three days later. I wonder whether you can guide us about whether these proceedings are in order. It is difficult for us to read and properly place these Amendments when, in the normal course of business, we go to the Vote Office and get a Bill and then discover that there is no
paragraph (b) of the foregoing subsection
printed in it at all. We depend on the hon. Gentleman to tell us which printing of the Bill it is, and discover that we have to have two separate Bills printed in a different way so that we may find out exactly what we are doing. This is an inexcusable muddle when we bear in mind that the Lords Amendments that we are discussing were printed on 17th March and, three days before that, the Bill was printed as it left another place.
I do not blame the Joint Under-Secretary, but I think that the Government, and the organisation which is supposedly behind them, are pretty rocky when we are presented with a situation such as this. I wonder, Mr. Deputy-Speaker, whether you can help us about the position of the procedure of the House regarding this matter.

Mr. Deputy-Speaker (Sir Gordon Touche): I should like to hear what the Minister has to say.

Mr. Galbraith: I do apologise for the great difficulty in understanding this small matter which I think is really only a question of printing.

Mr. Willis: Do not blame the printer.

Mr. Galbraith: No, but I should like the House to see whether it finds that the explanation I propose to offer is reasonable.
I think the situation is that in order to understand the Amendment which I have just moved, Clause 12 (1) of the Bill has to be divided into paragraphs (a) and (b). If it is not so divided this Amendment does not make sense, because it refers only to the second part of Clause 12 (1). I understand that when

an Amendment of this nature is moved, what might be called the "signposts" indications like "(a)" and "(b)" and "(1)" and "(2)"—are put in by the printer without their actually having been moved.
When I referred to Bill No. (45), that, of course, is not the Bill as it left the House of Commons. We are dealing with the Bill as it left the House of Commons, which is Bill No. (29). But Bill No. (45) shows the Bill when these "signposts"—paragraphs (a) and (b)—had been inserted, after the Amendment had been moved in the Lords. I was not saying that we ought to have a copy of Bill No. (45) before us. I was merely indicating that if any hon. Gentleman did happen to have a copy in his possession—as I have—it would make clear that paragraphs (a) and (b) are only punctuations, as one might call them—changes which make clear the meaning of the Amendment that I have just moved.
I appreciate that this is rather a complicated and difficult matter, and I hope that the explanation which I have given will help the House to realise that there is nothing extraordinary in the procedure which has taken place.

Mr. Manuel: On a point of order, Mr. Deputy-Speaker. I want to ask your advice. I understand that there is no second copy of the Notice Paper and that the Amendments we have before us refer exclusively to Bill (29). How can we deal with these Amendments, which refer exclusively to Bill (29), when the Bill we have to deal with is Bill (45)?

Mr. Deputy-Speaker: It has been explained that subsections (1) and (2) should be paragraphs (a) and (b).

Mr. Ross: No.

Mr. James McInnes: Further to that point of order, Mr. Deputy-Speaker. Could you enlighten us on the position? The only Notice Paper which we have before us at present is headed:
Lords Amendment to the Flood Prevention (Scotland) Bill".
The Amendment we are now dealing with is, in page 8, line 17, at end to insert the new subsection. But we cannot insert anything there because in Bill (45) which we have been given line 17 ends with the word "improve".
Obviously, the Notice Paper that we have has no connection with the Bill as at present constituted. In these circumstances, there cannot be an Amendment because it is not, from the phraseology point of view, in order in any shape or form. To that extent, I submit that you have more or less no alternative but to adjourn the proceedings on this Bill.

Mr. Deputy-Speaker: The question for me is whether the House agrees or disagrees with the Lords Amendment.

Mr. T. Fraser: Further to that point of order, Mr. Deputy-Speaker. Our difficulty, with which you will have to help us, is that we have not yet been convinced that we can possibly agree to this Amendment. You said a moment or two ago that you understood that subsections (1) and (2) are now paragraphs (a) and (b). With the greatest respect, even that has not been suggested.

Mr. Deputy-Speaker: I was wrong about that.

Mr. T. Fraser: May I suggest, then, that we cannot amend Bill (45) at the end of line 17 in page 8, because, as has been pointed out that, line ends in the middle of the word "improvement". We clearly cannot insert a new subsection between "improve" and "ment".
We resolved at the beginning of these proceedings to deal with Amendments proposed in Bill (29). Now we are asked to make an Amendment at the end of line 17 in page 8 by the insertion of a new subsection. This new subsection refers to
…paragraph (b) of the foregoing subsection …
It seems to us to be pretty odd to invite the House to put in a new subsection which refers to
…paragraph (b) of the foregoing subsection …
when there is no paragraph (b) in that foregoing subsection.
I ask for your help in this matter. The Government have not given us much help. They have said that there is another copy of the Bill, and we have looked at it, though we are supposed to pretend that it does not exist. We have had our attention called to Bill (29) which is the one which, according to the Order Paper today, we are seeking to amend. I suggest that the only Bill available

to us is Bill (29), and in that Bill subsection (1) of Clause 12 does not have any paragraph (b). That being so, it would seem to be wrong for the House to put in an Amendment which refers to paragraph (b) when there is no paragraph (b).

Mr. Willis: Further to that point of order. We are now asked to amend Bill (45).

Mr. T. Fraser: We are not.

Mr. Willis: We are asked to amend Bill (29). Bill (45) is already amended. This new subsection is already in Bill (45).

Mr. Manuel: They took it for granted.

Mr. Willis: Bill (45) was printed on 14th March before the Amendment we are now asked to endorse had even been considered by this House. This puts the House in a difficult position. We are being asked to pass an Amendment which is already incorporated in a Bill printed three months ago. It is incorporated in Bill (45) as subsection (2). We are in very much of a muddle.

Mr. Charles A. Howell: Further to that point of order, Mr. Deputy-Speaker. I realise the predicament in which you find yourself. At this stage, the Government have not been too helpful. You have ruled that we can decide either that this Amendment shall be in or shall be out.

Mr. Deputy-Speaker: I have not ruled on this question. It is for the House to say whether it agrees or disagrees with the Amendment.

Mr. Howell: You have said that it is for the House to decide, but the House is not even being asked to decide. You will appreciate why I have had to move to the back benches, for I am not allowed to speak from the Front Bench. I must raise this point of order because it is one of my duties to see that my leaders have adequate and correct papers, and until the Joint Under-Secretary of State mentioned Bill (45) we had no copies of it on the Table of the House. Therefore, the Order Paper which indicates what we are to discuss refers at the bottom to Bill (94) but at the top reads
The page and line refer to Bill (29) as first printed by the Lords.


Bill (45), which is dated 14th March, is not included in the Lords Amendments we are now dealing with. Bill (45) is actually the Report stage, as amended, in the House of Lords, not in the House of Commons, though it does not indicate that but simply says "as amended on Report". That is, however, as amended on Report in another place, not here.
Therefore, the Table of this House, or your servants, Mr. Deputy-Speaker, have supplied us with the requisite data and Bills which this House is to discuss tonight and have not given us Bill (45) but Bill (29). This is indicative that it was never intended to discuss Bill (45).
As the Joint Under-Secretary of State quoted Bill (45) he should withdraw it or ask leave of the House to adjourn these proceedings and bring the Bill back next week. We are not being obstructive. It is not necessary to have a long debate. But, in fairness to you and to the Table, we should have the Bill brought back at a time when the Order Paper says exactly what we are to deal with.

8.30 p.m.

Mr. Galbraith: Further to the point of order, Mr. Deputy-Speaker. Perhaps I can help the hon. Gentleman. Perhaps I made a mistake in ever referring to Bill (45). I apologise if that has caused any misunderstanding.

Mr. Charles A. Howell: Mr. Charles A. Howell rose—

Mr. Galbraith: I should like to finish. I am on a point of order. The hon. Gentleman is perfectly right in what he has said about Bill (45). I referred to it only to indicate what the Bill would look like after we had amended Bill (29), which, of course, is what we are concerned with.
I understand that the procedure on which we are engaged just now is the normal technical procedure for dealing with this sort of situation, and I would ask the House not to make a mountain out of a molehill, because there is nothing unusual or technically incorrect about what is happening.

Mr. Charles A. Howell: I think that the Joint Under-Secretary is misleading you, Mr. Deputy-Speaker.

Mr. Ross: This is not making a mountain out of a molehill. It is just examining another Government muddle. The

only thing that can be in order here surely is self-explanatory. We are asked to agree with the Lords Amendments to a Bill which left this House, and the Bill which left this House was Bill (29). Nothing else is in order.
The Amendment reads:
Page 8, line 17, at end insert—
'(2) Where a local authority are a sewerage or water authority and as such incur expenditure in carrying out, or paying compensation in respect of, any operations such as are specified in paragraph (b) of the foregoing subsection …'.
There is no paragraph (b) of the foregoing subsection in the Bill as it left this House.
The Government have to justify how they came to change a Bill after it left this House without making an Amendment in the other place. This is what the hon. Gentleman has said. Presuming that we, by reference to the original Bill as it left this House, should be able to understand their Amendment, I think that the Government are taking an awful lot for granted. I feel, Mr. Deputy-Speaker, that we are still entitled to a certain measure of guidance about whether this is in order or not.

Mr. Deputy-Speaker: Hon. Members may argue reasons for voting against the Amendment because it is not logical, but that is a matter for hon. Members themselves and not a point of order for me.

Mr. T. Fraser: But can we do this, Mr. Deputy-Speaker? Can you help us? Can we insert this Amendment? Are you inviting us to put in an Amendment which refers to paragraph (b) of the foregoing subsection when the foregoing subsection contains no paragraph (b) at all?
I submit that the Government have just made a mistake. They have forgotten to put down earlier Amendments to Clause 12 (1). They have apparently made certain Amendment to Clause 12 (1) since the Bill left this House. As the Bill left this House it does not have subsection (1) divided into paragraph (a) and paragraph (b). In Bill 45, at which we ought not to be looking at all because that is the Bill as it will look after we have made all these Amendments, Clause 12 (1) is divided into paragraph (a) and paragraph (b). Somehow or other the Government have made the Amendments to this subsection without consulting either another place


or this House. All I am suggesting is that the Government have slipped up in not putting down Amendments to this Clause.
It may be, of course, that if they did not trouble to ask the other place to make these Amendments they could hardly ask us to agree with the other place in the Amendments. In any case, if the Bill as it is now does not have subsection (1) of Clause 12 divided into paragraph (a) and paragraph (b), I cannot see how the Bill can become an Act of Parliament without Parliament making this alteration. All I am asking is whether we can proceed in this rather clumsy and slipshod way. Ought we not to have these proceedings adjourned to enable the Government to have another look at the matter and see whether they can put it right?

Mr. Charles A. Howell: I disagree with the Joint Under-Secretary when he says that he ought not to have mentioned this. He had no option but to mention it, because my hon. Friend asked him where the paragraph was to which this Amendment refers. The words are very simple in so far as they refer to:
such as are specified in paragraph (b) of the foregoing subsection…
My hon. Friend asked where paragraph (b) of the foregoing subsection was, and it is just not there.
I suggest, with all due deference to your position in the Chair, Mr. Deputy-Speaker, that when this started you had not a copy of Bill (45). Consequently, you have not a copy of subsection (b) unless someone has supplied you with one while the controversy has been going on.
Surely, therefore, from the point of view of respect for the House and from the point of view of the procedure which will be recorded in HANSARD and referred to at some other time, it is wrong to try to amend something which is not there. If it is not there, then I suggest to you, Mr. Deputy-Speaker, that your Ruling should be that there cannot be an Amendment to a Bill which does not exist. There cannot be an Amendment to a subsection which does not exist, unless we are presented with a Notice Paper telling us that we can discuss Bills 29 and 45.
The Joint Under-Secretary of State said that he ought not to have referred to Bill (45). I do not doubt that he wishes he had not done so, but he had no option because my hon. Friend asked about the subsection which it was sought to amend. If there is no subsection in Bill (29) to amend, we have no jurisdiction to discuss an Amendment which occurs in relation to something other than this Bill.

Mr. Galbraith: May I try once again to help the House? We are dealing only with Bill (29). I am assured that there is no need for these consequential Amendments to be formally moved in this House and that arrangements will be made for them to be picked up by the printers. They were not moved formally in another place, but they were incorporated in the latest print of the Bill. I referred to Bill (45) to show what this would look like when it was finally dealt with.
I am assured that these two minor amendments were not formally moved in another place and that therefore consideration of them in this House does not arise. As I tried to explain, and I thought that the hon. Member for Hamilton (Mr. T. Fraser) was understanding my point, the Amendment does not make sense unless there is a reference to paragraph (b), because subsection (1) is divided into paragraphs (a) and (b), and the Amendment on which we are engaged refers to paragraph (b).

Mr. Ross: So that we can get the debate on a proper footing, Sir Gordon, would it be in order for me to move to adjourn the debate?

Mr. Deputy-Speaker: I would not be prepared to accept such a Motion.

The Secretary of State for Scotland (Mr. John Maclay): We are dealing with a highly technical point, but I am assured that the procedure is normal and appropriate to deal with a situation like this. One can go on indefinitely asking "Why?", but, unless I am assured by the authorities that the procedure is wrong, I am sure that the document and the method are correct. One cannot go on asking why without rewriting Erskine May. I believe that we are technically correct in the way that this has been done.

Mr. Ross: I am sure that the right hon. Gentleman would disqualify the appointment of a chief constable for less than this. I do not see why we should resist the temptation to ask the Government to explain why they refer to a subsection which is not in the Bill as it left the House. If they want to make punctuation changes, the time to do so is after the Bill has left the House of Commons and before it has received its final consent.
We are presumed to understand a subsection which has never been mentioned and which is not in the Bill as printed. What kind of people does the right hon. Gentleman take us for? It is not for the Officers of the House to explain this. This has not been done by them. The House is being asked to accept an Amendment which refers to
operations such as are specified in paragraph (b) of the foregoing subsection…
The right hon. Gentleman cannot get away from the fact that there was no subsection (b) in the Bill which left the House. It is as simple as that. It is utter nonsense to suggest that the answer is that the right hon. Gentleman has power to do this. If he has that power to do it, he could have got it by putting down an Amendment in another place. We would then have been able to understand it because we as the House of Commons would have approved it and we would have known what we were doing.
The House of Commons cannot be justified in passing something that is nonsense. It is taking liberties with the law as we pass it for the Secretary of State to adopt the attitude that this is just a technicality. I can remember a Bill being withdrawn only a short time ago for just a technicality. I think that it was a question of the singular instead of the plural, or vice versa, during an all-night sitting. The technicality was such that because of the procedure of the House, a very important Money Resolution had to be withdrawn.
I should like to give the Secretary of State time to rethink what he is to do about this, because we are now in the position that if, as a House, we disagree with this Amendment, as I think we must, it cannot be taken back to another place and be put right. These technicalities are very important, as I am sure the

hon. Member for Fife, East (Sir J. Henderson-Stewart), a former Joint Under-Secretary of State for Scotland will appreciate at once.
We had a confession in relation to the Finance Bill because, at the last moment, someone in Southport spotted an error that had evaded all the eagle eyes at the Treasury, but in that case the Financial Secretary came here at the last minute with an Amendment to put the matter right. I am sure that the Secretary of State needs time to study what he is to do about this, and I think that he ought to be a little more apologetic to the House about this muddle.

Mr. Cyril Bence: On a point of order, Mr. Deputy-Speaker. I should like your guidance, because the great confusion on the Government side has confused me. I understood from the Under-Secretary that these Amendments from another place were put down to Bill (29) but did not appear to make sense because of certain wording in the Amendment in page 8, line 17. I understood that the Government then ordered another Bill—Bill (45)—to be printed to show us what the Measure would look like as a result of certain Amendments made in the Department.
I presume that they were made in the Department; they were not made in another place, and they certainly were not made in this House. The Executive must have decided to alter Bill (29) into the style of Bill (45). That was not done in this House or in another place, but in the Department, and the Bill was printed on 14th March, to show what it would look like when these people, whoever they were, had made the appropriate changes in the Bill.
As a Member of Parliament I have not been given an opportunity to express a view on whether the change in form from Bill (29) to Bill (45) is reasonable and appropriate. I am now asked to discuss an Amendment to Bill (29) which did not make sense to me until my hon. Friend the Member for Glasgow, Central (Mr. McInnes) managed to find Bill (45). Neither in the OFFICIAL REPORT Of this House nor of another place can I find a report of any change in the structure of the Clause being made. If we let this go, it seems to us that we are agreeing


to the right of the Executive to alter the framework of a Bill or a Clause in an institution other than the House of Commons or another place—perhaps in Dover House. That is quite unacceptable.

Mr. Deputy-Speaker: That may be a reason for voting against the Lords Amendment, but it is not a matter for me.

Mr. T. Fraser: To put our discussion in order, Mr. Deputy-Speaker, may I move that the debate be now adjourned, so that we may have a proper discussion?

Mr. Deputy-Speaker: I cannot accept such a Motion.

Mr. Fraser: Then may I refer to the point that I put before? We are asked to make an Amendment which does not make sense. I sought to move a Motion, Mr. Deputy-Speaker, so that we might discuss the difficulties in which hon. Members have been placed. If you will not allow a dilatory Motion—

8.45 p.m.

Mr. Deputy-Speaker: The House is already discussing the question whether or not the Amendment makes sense.

Mr. Fraser: With respect, Mr. Deputy-Speaker, I thought that the Question before the House was, "That this House doth agree with the Lords in the said Amendment."

Mr. Deputy-Speaker: One of the reasons for agreeing or not agreeing obviously rests on the question whether or not it makes sense.

Mr. Fraser: We sometimes disagree with a proposal, even though it may make sense.
Many arguments and proposals, some of them put forward by hon. Members on this side, make sense and it is a matter of judgment whether or not they are accepted. But in this case it does not make sense to propose an Amendment to page 8, line 17, in Bill (29), which is the Bill before the House—an Amendment which includes a new subsection (2) which refers to paragraph (b) "of the foregoing subsection" when the foregoing subsection contains no paragraph (b).
understood the Secretary of State and the Under-Secretary both to say that it is quite proper and in order to amend a Bill so to break up a subsection into

paragraphs (a) and (b) without consulting the Legislature. Having made that observation, I appear to be getting no response from either of the Ministers, but if, in fact, we make this Amendment to the Bill we will be making nonsense of the Bill unless these Amendments are made by breaking up the subsection into paragraphs (a) and (b) without consulting the Legislature. In seeking to move "That the debate be now adjourned" my hon. Friends and I are merely wishing to give an opportunity to the Ministers not only to explain the position, but to enable them to defer further consideration of the Bill until they can put themselves right with the Legislature.
It would surely be wrong for the Secretary of State to ask hon. Members to amend a Bill that was printed on 2nd February, since when there have been further editions of the Bill printed. If the right hon. Gentleman wishes to break up subsection (1) of Clause 12 into paragraphs (a) and (b) without consulting the Legislature, it is surely reasonable to ask him to have this exercise performed before the Bill comes before us to make this Amendment now.
If the Minister could not do it before he came before the House on this occasion to make this Amendment, I venture to suggest to you, Mr. Deputy Speaker, that the Minister is incapable of doing it between now and the Bill becoming an Act. Thus the Secretary of State has a responsibility to defer further consideration of this Amendment until he has made some amendment to subsection (1)—either by consulting the Legislature, as I would have thought he would have been obliged to do, or, if he can do this without consulting the Legislature but by using the facilities of the printer, to have the adjustment made and then to come to the Legislature and invite us to make an Amendment which would then make sense.
I would have thought that that was the only way to make our proceedings sensible on this ocasion and I hope that although you would not accept from me the Motion, "That the debate be now adjourned", you will, Mr. Deputy-Speaker, accept a similar Motion if it is moved by the Secretary of State.

Mr. A. Woodburn: Tama little puzzled by the attitude of the Government. I


do not want to twist their tail unduly, but at some time during the passage of the Bill through the Lords the Bill beame amended, and on Report it was considered by the Lords in the form in which it has come to us as Bill No. (45). We technically have no knowledge of that Bill as it was considered by the Lords on Third Reading. That is, of course, not the Bill which left the House of Commons, and we must consider the Bill as it left this House. The Amendment which we are considering is to the Bill as it left the House of Commons and, as I think you rightly said, Mr. Deputy-Speaker, the House of Commons is entitled to pass that Amendment. The Government have invited us to pass that Amendment.
I should like to know—and perhaps the Lord Advocate can help us—exactly what is the Act of Parliament which eventually will be put forward for the Queen's signature? Is it No. (29) as amended by the Lords Amendments which are before us this evening? If so, as has been pointed out by my hon. Friends, that makes nonsense. Is there some possibility that between now and the presentation of the Bill to Her Majesty the Executive can make all sorts of little alterations to tidy the Bill up between times? Would that be legal?

Mr. Deputy-Speaker: I understand that the printer is entitled to do that.

Mr. Woodburn: I have always understood when debating matters in Committee that even commas can be very important. A comma transposed from one part of a sentence to another could alter the sense completely. Is it permissible for the Government or for the printers to make any alteration in a Bill which changes the sense of the Bill? Somebody ought to explain the legal position. I have no recollection myself of having been able to alter Bills between different stages or after it has left this House. When I think of the arguments which have taken place in Standing Committee on whether the word should be "may" or "shall" and little incidentals of that kind, it seems inconceivable that permission can be given to the printer to alter a Bill in such a way as to make it different from the Bill as it has passed from this House.

Mr. McInnes: May I put a simple point, Mr. Deputy-Speaker? According to the Order Paper, the House is invited to consider the Lords Amendments to the Flood Prevention (Scotland) Bill. I find myself in possession of two Flood Prevention (Scotland) Bills. Would you guide or direct the House as to which is the proper Bill? Which of the two Bills is the House considering at the moment?

Mr. Deputy-Speaker: We are now considering the Lords Amendments.

Mr. McInnes: The Lords Amendments to which Bill?

Mr. Deputy-Speaker: The Flood Prevention (Scotland) Bill.

Mr. McInnes: But there are two.

Mr. George Lawson: On a point of order, Mr. Deputy-Speaker. We are very concerned about this and we should like a direct answer. We are told on the Amendment Paper that we are considering Bill No. (29). Are we or are we not considering Bill No. (29)? We want no dodging around that question. Will you give us a direct answer? Surely we are considering Bill (29); we can be considering nothing else. I do not like this practice of getting around the position because errors have been made. Why not agree that errors have been made and withdraw the Bill? Let us get on with the business in front of us.

Mr. Maclay: On a point of order—

Mr. McInnes: I am on a point of order. May I put this to you, Mr. Deputy-Speaker? There are two Flood Prevention (Scotland) Bills—

Mr. Lawson: Only one Bill is in front of us.

Mr. McInnes: There are two Flood Prevention (Scotland) Bills. I have them in my hand at the moment. Which of these two Bills is the House expected to consider in relation to the Lords Amendments?

Mr. Deputy-Speaker: No. (94), I understand.

Mr. Charles A. Howell: Mr. Deputy-Speaker, I know you have in your possession Bill No. (45), because I took


the liberty of handing a copy to you. Will you look, Mr. Deputy-Speaker, at page A of Bill No. (45) which I handed to you, and at page A2 of Bill No. (29)? You will see that the wording is exactly the same. It could easily have been a reprint of Bill No. (29) but for the fact that it says at the top, "As amended on Report". When a Bill goes to the House of Commons, as it is amended in Committee or on Report, the previous print becomes out of date.
I suggest, Mr. Deputy-Speaker, that there has been a mistake here in the presentation of these Amendments to the House. If Bill No. (29) has been amended and has now become Bill No. (45) and there are words in Bill No. (45) which are not in Bill No. (29), it ought to have been Bill No. (45) which the House was debating.
The Ruling we seek from you is very simple. Is it possible to amend something which does not exist? We are asked to consider an Amendment. One of my hon. Friends asked what subsection it referred to, and we were told that it is in a different print. I suggest, Mr. Deputy-Speaker, that whatever may be in Erskine May or anywhere else, it should be logic. If it is not logic, the House will be held to ridicule because it has tried to amend something which does not exist. Nobody would have much confidence in the House of Commons if it attempted to amend something the original substance of which had not been put before it.

Mr. T. Fraser: On a point of order, Mr. Deputy-Speaker. In reply to my hon. Friend the Member for Glasgow, Central (Mr. McInnes), you said that the Bill we are seeking to amend is Bill (94). May I call your attention to the fact that the Notice Paper which we have before us says that we are considering Bill No. (29)? There has been some reference to Bill No. (45). Until you mentioned it, we had had no reference to Bill No. (94). May we have Bill No. (94)?

Mr. Deputy-Speaker: If the hon. Member will look at the Notice of the Lords Amendments to the Flood Prevention (Scotland) Bill, he will see that it is Bill No. (94).

Mr. Fraser: There is no Bill No. (94), so far as I am aware. I notice that at

the top of the front page of that Notice Paper it is said:
The page and line refer to Bill (29) as first printed by the Lords.
That is the Bill which we are to amend. I do not think we are amending Bill No. (45). I do not think that there is a Bill No. (94). If there is, it is not available on the Table.

Mr. Deputy-Speaker: Perhaps I can help. This document, the Notice of the Lords Amendments, is technically the Bill, Bill No. (94).

Mr. Fraser: The Notice of Lords Amendments is itself technically a Bill, and it is No. (94), but the Bill which we are amending, I submit, is Bill No. (29).

Mr. Deputy-Speaker: That is right, yes.

Mr. Fraser: That is why I wish to move a dilatory Motion so that we may consider this matter at a future date because Bill No. (29) contains no paragraph (b) in subsection (1) of Clause 12. That is why we cannot amend it.

Mr. Deputy-Speaker: It has been subjected to some printing alterations. That is all.

Mr. Fraser: If the Secretary of State can arrange for printing alterations to be made after the House of Commons has finished its consideration of the Bill, why was not he able to make some printing alterations between the Bill leaving another place and its returning here, or, indeed, when the Bill was in another place, before we were asked to adopt Amendments made by another place?

Mr. Deputy-Speaker: The Secretary of State does not arrange for these printing alterations. They are made by the officers of the House of Lords.

9.0 p.m.

Mr. Willis: With respect, Mr. Deputy-Speaker, I submit that this is more than an alteration in printing. Certainly, this is an alteration to the punctuation and division of a sentence, and a very long and complicated sentence. We do not know how that division has been made, and everyone who has any knowledge or has studied the matter at all knows that we can divide a sentence in ways that give completely different meanings. We have no knowledge officially of how


this sentence has been divided. All we know is that it is to be divided.
I submit to you, Mr. Deputy-Speaker, that as we do not know whether or no the meaning of subsection (1) has been changed as a result of this alteration, it becomes rather more than a printing error and constitutes what I should have thought was a drafting Amendment to the Bill, but this is a drafting Amendment that has neither been approved or passed by this House or another place.

Mr. Deputy-Speaker: That may or may not be a reason for voting against this Lords Amendment.

Mr. Lawson: On a point of order. We do not know what we are voting on. We are concerned with this particular Amendment. We are asked to agree to an Amendment, and when we vote on that Amendment it will not be related to the Bill because the Amendment has no relation to it. We are now in a muddle because people have been acting in a muddled fashion, but the Secretary of State for Scotland is not prepared to admit that and adopt the simple expedient of admitting that it is muddled, and to say that he will take it back, put it right and bring it back again.
This House is being insulted, and this is another example of how it is being treated by hon. Gentlemen opposite—as if it did not matter at all. We cannot possibly make this Amendment here because it does not make sense and relates to something that does not exist. I suggest that the only thing that can be done in the interests of the House with this Bill is to pull it out and let us get on with the rest of the business. If I can, I will move in that direction.

Mr. Deputy-Speaker: I am sorry, but the Secretary of State cannot withdraw the Lords Amendments.

Mr. Woodburn: On a point of order. I raised a point a little time ago, and I accepted your Ruling, Mr. Deputy-Speaker, that our duty was to vote for or against this Amendment. The Government are asking us to vote for it, and if it goes to a vote, it will be carried. It is recognised by everybody that, textually, the Amendment relates to Bill No. (29), but it does not make sense. I ask for your guidance. Can you say whether

there is any authority or precedent for a Bill being changed after it leaves this House and before it goes to the Queen for signature? I am not quite clear about it, but it seems that somewhere between here and the Queen, further alterations are to be made to the Bill in order to make it make sense, although it does not make sense here. Alterations will be made. Who is to make the alterations, who has authority to do that and what is the precedent for legislation being changed after the House has passed it?

Mr. Deputy-Speaker: The Officers of the House of Lords made the corrections, but it is not unusual for changes and corrections to be made in the printing of a Bill after it has passed this House. When we have a new Clause in a Finance Bill, we leave it to the Officers to write the number in.

Several Hon. Members: Several Hon. Members rose—

Mr. Manuel: May I press the point as to what we are now discussing? I understand your Ruling, Mr. Deputy-Speaker, and I appreciate what you have said, but my great difficulty is in finding out how this Amendment could be put down to Bill No. (29) and to a subparagraph of a "foregoing subsection" which is not in the Bill. If I had tried to do that, I could never have got it accepted by the Table Office. If I could not get it done, if I had wanted to do this sort of thing, what other forces are at work in order to get it into a nonexistent subsection?

Mr. Deputy-Speaker: This Amendment has been made by the House of Lords; it is not for me to rule it out of order.

Mr. Ross: On a point of order. You suggest, Mr. Deputy-Speaker, that this Amendment was made in another place, but that is the cause of our trouble, because it was not made in the House of Lords on any Motion. Indeed, it has not been made at all, either in this House or in another place, and that is the difficulty we are in. We as the House of Commons can only deal with the merits of the Lords Amendment in relation to the Bill that left this House, because we are being asked to agree to an Amendment which another place made to a Bill that we have passed.
We can only deal with the Bill that we passed and assess the merits of the Amendments suggested by another place, because these Amendments do not become law until both Houses have agreed about them, and until that has been done properly it cannot become law and have the Royal Assent.
The only Bill with which we can possibly deal is the Bill which left us. In the Bill which left us this subsection was not divided. If the printers are to make corrections and changes in the reprinting of the Bill, it must be done at a point where there can be no confusion for either branch of the Legislature. It is quite wrong for the Government to ask us to agree to an Amendment made by another place when it does not make sense in relation to the Bill which left this House. As I say, the only Bill with which we can deal is the Bill which left us. We can only examine the Amendments which are suggested to that Bill. May I have your guidance on the point, Mr. Deputy-Speaker? That is the only Bill that is in order.

Mr. Deputy-Speaker: Each House must allow the Officers of the House to make printing corrections. That has always occurred here. The hon. Member may disagree with it, and he is entitled to vote accordingly.

Mr. T. Fraser: Surely when the Lords made the Amendment which is before this House now, namely, to insert a new subsection in Clause 12, the Bill then before the Lords had subsection (1) divided into paragraphs (a) and (b). That is the only way in which the new subsection (2) would make sense. I hope that you, Mr. Deputy-Speaker, are not suggesting that the printers would change the Bill without consulting the Minister in charge of the Bill. The Minister has invited us to agree with the Lords in an Amendment which assumes that the printers in the House of Commons will make an alteration in the text of the Bill such as you, Mr. Deputy-Speaker, have suggested was made by the printers in another place.

Mr. Deputy-Speaker: It was not made by the printers. It was made by the order of the Officers of the House.

Mr. Fraser: The Officers of the House in another place ordered certain textual alterations to be made.

Mr. Deputy-Speaker: They were printing alterations.

Mr. Fraser: Very well, printing alterations to be made. The Officers of the House in another place presumably have ordered that subsection (1) of Clause 12 should be divided into paragraphs (a) and (b). I submit to you, Mr. Deputy-Speaker, that Her Majesty's Ministers were aware that the Officers of the House in another place had made this printing alteration and had divided the subsection into paragraphs (a) and (b). If they had not been aware of that and if the other place had not seen a Bill which had subsection (1) divided into paragraphs (a) and (b), it could not have put in the new subsection (2) with which we are asked to agree.
The Minister has moved a Motion, That this House doth agree with the Lords in the said Amendment, an Amendment which the Lords presumably made after the House authorities had ordered a printing alteration in subsection (1), because only then did it make sense. In any event, all this happened many months ago. The last Bill to emerge from the House of Lords was printed on 14th March. This is now 4th July. I would have thought that the House authorities in the House of Commons might have had equal power with the House authorities in the House of Lords to make a printing alteration. Had they had such authority and exercised it, it might well have been that we would have had before us today a Bill in which the making of the Amendment now before this House would have made sense.
Those things have not happened, however, and this Amendment makes nonsense, because it refers to
paragraph (b) of the foregoing subsection
when there is no paragraph (b) in the foregoing subsection. We are assuming that the authorities of the House will generously observe how stupid the House of Commons was—and the House of Lords—and will make the necessary alterations to make subsection (1) into paragraphs (a) and (b).
The obvious thing to do is to delay the further consideration of the Bill. We have a good many other Scottish Bills before us. We want to get on with them and to get them through. The Leader


of the House is not about, but the Chief Patronage Secretary is here. He would not wish to bully the House into accepting an Amendment which makes nonsense—at least, that is one's hope. Can he not authorise the Secretary of State to get up and move to adjourn the debate so that we can have this thing put right and give the House authorities in the House of Commons the opportunity, if they have the power, to make these printing alterations in like manner as they have, apparently, been made by the authorities of the House in another place?

Mr. Manuel: Does my hon. Friend suggest that the Chief Patronage Secretary can order the Secretary of State to do anything?

Mr. Fraser: I think that the Chief Patronage Secretary can order the Secretary of State to do it. The Chief Patronage Secretary has a lot of power in arranging the business of the House. He has responsibility with the Leader of the House to ensure that when this House legislates it legislates sense. That is clearly what we are being invited not to do. We are being invited to make an Amendment which makes nonsense. The justification of our being so invited, I understand, is that the House authorities the authorities of the House, presumably—have the power to order a printing, alteration to be made to subsection (1). There is, however, nobody with any authority to advise us that it is the intention of the authorities of the House to do anything of the kind. Nobody has assured us that the Bill that is sent from this House to Her Majesty in due course will have subsection (1) of Clause 12 divided into paragraphs (a) and (b). We have been told that the Bill that we sent up to another place had this alteration made by order of the authorities of the House along the corridor.
The Secretary of State for Scotland, the Minister responsible for the Bill, seems to have been completely unaware of this—or is he unaware of it? He invites us to agree with their Lordships in an Amendment which refers to paragraph (b) of subsection (1) of Clause 12. Therefore the Secretary of State recognises that the authorities here along the passageway may alter his Bill by sub-

dividing a subsection into paragraphs (a) and (b) without his giving us an assurance that Clause 12 (1) will be similarly altered at this end of the building into paragraphs (a) and (b).
9.15 p.m.
We have had a good deal of difficulty, Mr. Speaker, over an Amendment that is before the House. It is the Amendment in page 8, line 17, at the end to insert a new subsection (2). This Amendment has been commended to us by the Secretary of State for Scotland who has asked to agree with their Lordships in it. It refers in line 4 to paragraph (b) of the foregoing subsection, which is Clause 12 (1), but subsection (1) has no paragraph (b) at all. In the circumstances we have been asking if we might move that the debate stand adjourned to enable the Secretary of State to have all this put right.
Mr. Deputy-Speaker has declined to accept such a Motion and I have been in process of asking the Chair if we can be obliged—because that is what is happening—to make an amendment of the Bill which makes nonsense of the Bill without even an assurance that subsection (1) will be altered, if it can be altered between now and the Bill going to Her Majesty, so that the Bill will have a subsection (1) which is subdivided into paragraphs (a) and (b).
I wonder whether, Mr. Speaker, you can give us any protection and whether you can say if we are obliged or not to vote on the Amendment tonight. Some of us would wish not to vote on it. We would prefer that subsection (1) were so altered that this new subsection would make sense. Can we be protected, therefore, by not being obliged to vote for or against the subsection tonight? I imagine that the only way that that could be done would be for the Government to agree to adjourn the debate. Would you accept such a Motion from me or ask that the Secretary of State should move such a Motion?

Mr. Speaker: The hon. Member for Hamilton (Mr. T. Fraser) is being more than kind and courteous to me, because he has seen that I have only just resumed the Chair. I am most grateful to him. Clearly there would be great difficulties about the propriety of the Chair assuming to accept the kind of Motion which the


hon. Member has in mind, not because it would deny him and his hon. Friends a proper line of attack against the Government, but because it is commonly known that printing errors as such are inevitably corrected before some Lords Amendment is incorporated in the Bill. That is the difficulty about that kind of point.
If it has substance, as opposed to being a printing error, then obviously the Chair is confronted with a different problem in accepting that kind of Motion. For that reason, I am not at all critical of either the Ruling of my immediate predecessor in the Chair or of the hon. Member for seeking to deal with the matter in the way he does. The question, of course, is whether the House, subject to the known understanding that purely printing errors are corrected on their way, desires to agree with the Lords Amendment or not. I cannot give the hon. Member further guidance than that.

Mr. T. Fraser: May I assure you, Mr. Speaker, that this is not a printing error and that the Bill now before us and which we are being invited to amend is exactly that Bill which we sent from the House some months ago? It has been printed accurately. It is the fact, however, that when the Bill emerged from another place the authorities of the House had been instructed that subsection (1) of Clause 12 would be divided into two parts, paragraph (a) and paragraph (b). Subsection (1) having been so divided, another place added a new subsection, subsection (2), which refers to paragraph (b) of the "foregoing subsection". For some reason or other, the Bill before us is exactly as it was when it was sent to another place and the authorities of the House have been unable to make the alteration which it was possible to make in another place. We are asked to have a new subsection which refers to paragraph (b) of a foregoing subsection when that foregoing subsection does not have a paragraph (b). I am seeking to make it clear that there is no question of there being a printer's error to put right.

Mr. Speaker: I am inviting the hon. Member's, assistance because this is new to me and he has been looking at it. However, on the face of it, it looks like a printer's failure to correct something necessitated by an Amendment in another place. If I have it wrong, I

invite correction, but that is what it looks like.

The Secretary of State for Scotland (Mr. John Maclay): I have carefully consulted anybody I could consult and I am told that the procedure followed and the explanations given are completely in accord with the procedure in cases of this kind, and that the action taken in another place and by the officials of the House is normal. That is all I can say. One cannot say any more.

Several Hon. Members: Several Hon. Members rose—

Mr. Manuel: On a point of order. We are here dealing with Lords Amendments to Bill (29), the only Bill before the House. Bill (45) does not exist as far as we are concerned. We are asked to insert words which refer to other words which are non-existent. How can it be in order to discuss this Amendment when a paragraph to which it refers is not there?

Mr. Woodburn: Further to that point of order.

Mr. Speaker: First, I wish to receive advice. In due course I will listen to the right hon. Gentleman.
I do not think that this is difficult. It may be for the Chair, but it is not in fact if we look at the substance and not at the form. That is what we have to do. The Officers of this House and another place habitually make printing corrections which are not, in fact, presented as something to which either House has to assent. They effect a marriage, as it were, in a printing sense, between the two forms of Amendment that either House may make. That normally happens as an ordinary process, provided that either House has agreed to the principle, and we, for instance, have accepted the principle to which another House has invited our agreement. The requisite printing marriage is then effected by our Officers without specific reference to subparagraph (a) or (b), or whatever it may be, or whether something is numbered 1, 2, or whatever it may be, or the particular print of the Bill.
The hon. Member for Central Ayrshire (Mr. Manuel) evoked the most unhappy but sympathetic memories in my mind because, as a Law Officer, I could never get hold of the particular Bill, from one place or the other, to which I had to


apply this or that. There is nothing abnormal about this issue if we look at the substance and what we have to legislate about.

Mr. Woodburn: I quite appreciate the point you have made, Mr. Speaker, but there is this difficulty. While everyone would agree that printing errors should be put right, drafting alterations are usually the subject of Amendments in Committee and sometimes there is a long discussion on them. When this Bill (29) leaves here, as amended by this House, it will eventually go to the Queen. It will not go to the Queen in the form in which we pass it here this evening, but, as you suggest, Mr. Speaker, it will be blended with what has been passed in another place of which we have no cognisance officially.
A very great power seems to lie between here and the Bill's presentation to the Queen. I should like your guidance as to who is responsible for seeing that when the Bill is eventually presented to the Queen these drafting Amendments do not in any way alter the sense or effect of the Bill. The alteration of a comma, as we are all aware, can make a tremendous difference in the sense of a Bill legally. Who is responsible for seeing that the changes are in accordance with what has been passed by both Houses?

Mr. Speaker: There are a number of points. First, I hope that I shall not as a one-time lawyer be taken to agree with the proposition of the right hon. Member for Clackmannan and East Stirlingshire (Mr. Woodburn) that the position of a comma may make a difference in a Statute. Statutory punctuation is something aside. What we submit for the Royal Assent is the ultimate legislative agreement of the two Houses through a process known to us all.
The assistance that I want from the right hon. Gentleman and other hon. Members, if I need any, is to discover whether, apart from any printing correction or printing assimilation, someone is urging on some basis that the Amendment to which the House is at the moment invited by the Government to agree is in some way distorted in a matter of texture. If I have no understanding of what the substance is, this is no doubt because I have been out of the Chair. I should be grateful to have an

explanation from someone of why it is said that the substance, as contrasted with some printing marriage to be effected, or Amendment for amalgamation, is distorted by what is now presented to the House. That is a matter on which I should like assistance.

9.30 p.m.

Mr. Lawson: Is it not the case that when we are dealing with the Amendments to the Bill, we are concerned with the words of these Amendments? Words may be interpreted differently. We are regularly enjoined to concentrate our attention on words and the arrangement of words. Here it would seem to be argued that it is the conjunction of the words only. Surely that is an impossible position for us to be put in. We might at any time on any Bill argue that it is the interpretation that matters. If my interpretation differs from another interpretation, it is my interpretation that matters and not the words. It seems to me that here we are invited to do what is an absurd thing. On the basis of the Amendments and the Bill before us we are asked to make a nonsensical Amendment.
I am asking you Mr. Speaker, if the interests of this House are to be maintained and we are not to be regarded as behaving in an absurd fashion, whether we should not fairly ask that the Bill be withdrawn so that the matter may be put right, and we can decide what is to go into the Bill.

Mr. Speaker: I am sorry. I thought that the hon. Member for Motherwell (Mr. Lawson) was rising to assist me. I do not derive assistance from the proposition that the Bill should be withdrawn in consequence of what has happened. As I understand it, the Lords have put in a paragraph (b)—

Mr. Manuel: We do not know of that.

Mr. Speaker: If the hon. Member would wait a moment. I prefer to explain what I am saying without interruption.
As I understand it the Lords have put in a paragraph (b). Should this House assent to the Lords Amendment, it will be necessary to effect some marriage between the two texts. The fact that the Lords Amendment, in form, anticipates that marriage does not vitiate the


fact that this House has to consider. I hope that I have got it right. If I have not got it right I should welcome assistance because I have returned to the Chair in the middle of the debate. But I should not be assisted by the kind of proposition that because the words "paragraph (b)" appeared in this Amendment therefore I should require the Government to withdraw the Bill in its entirety. That sort of thing does not help me. But I should welcome assistance from any hon. Gentleman who feels troubled about a point of substance.

Mr. Lawson: I was not inviting the Government to withdraw the Bill in its entirety, but merely for this evening, on this occasion. It could be brought back next week or at some other time when the matter is in proper order. We want to get on now with the matters before us and have this Bill brought up at the earliest opportunity next week, if that could be done, so that we may deal with it sensibly.

Mr. Ross: I wonder whether you, Mr. Speaker, can help u—

Mr. Speaker: It is not I who can help the hon. Gentleman. For the moment I am inviting help from the hon. Gentleman, if he is feeling troubled. If not, I do not want it.

Mr. Ross: From a House of Commons point of view I understood that tonight we were looking at the Lords Amendments to a Bill which we passed. The Bill which we passed was the Bill as printed, No. (29), on 2nd February, after we had dealt with it on Report and on Third Reading. The point is that that was the third printing of the Bill as far as we were concerned. We had the Bill printed and presented to us. There were the First and Second Readings and we amended it during the Committee stage. It was printed again and we amended it on Report stage and that was the Bill as it left us. At no time in the reprinting or the amendment of that Bill did we have any subdivision of this subsection into paragraphs (a) and (b). I consider, and I ask for your guidance on this, Mr. Speaker, that the page and line refers to Bill No. (29) as first printed by the Lords. That Bill, as first printed by the Lords, which we sent to them, contained no division into paragraphs (a) and (b).

There was no Motion made in the Lords so to subdivide it.
The suggestion is made that this is just purely punctuation. I am delighted to hear it, particularly in view of a telephone conversation on exactly the same point in relation to another Bill which I had with the Solicitor-General. I do not wish to anticipate legislation which may be introduced later this year, but the right hon. and learned Gentleman did not seem to take the view that it is punctuation—

Mr. Speaker: Order. I think that in fairness between one side of the House and the other, and having invited the hon. Gentleman to help me, I should not allow him to enter into matters of that kind. I think I have it. It may be—I am not suggesting that it is because I have not studied the matter —that the note at the top of the Lords Amendment in italics, for which this House or another place may be responsible—I do not know—may be wrong. But it still does not make any difference with regard to the substance. The hon. Gentleman and I know from legislative experience that we send Bills from this House to another place and there, if that House thinks fit, their Lordships amend it and they may add a paragraph (b) or a sub-paragraph (d), or a preface to "x" or "y". That occurs in the printing of the Bill which they finally part with and pass back and that results in the fact that a line Amendment to the Bill which they finally passed back to us may key in with the numeration or alphabetical classification, and so on, in the form of the Bill which the Lords send back to us. If the hon. Member has been unable to find out, with his duties here, exactly what is the paragraph (b) referred to, then I would have to have time presonally to do research, because I do not at this moment know exactly to what it does refer. It is not actually my duty to know, but I could find out. If the hon. Gentleman is in real difficulty about that, I am ready to assist him. If it is an artificial difficulty, I am not ready to assist him. That is the point which I wish to put.

Mr. Manuel: Further to that point of order, Mr. Speaker. I am grateful for the explanations you have given.


My difficulty is that these Lords Amendments are coming before this House to amend Bill No. (29), which is all that we have before us. We have some knowledge of a Bill No. (45) which contains, in Clause 12, two paragraphs. This Amendment is to insert certain words at the end of line 17. It is trying to do something to a "foregoing subsection" that is not in the Clause as we have it before us.
If I, as a Member of this House, tried to put down an Amendment like that it would be ruled out of order. Do I take it that the House of Lords has certain rights over and above those of Members of this House in amending legislation?

Mr. Speaker: No, none at all. I think that I did the other place a moderate discourtesy in suggesting that the note at the top of the Notice Paper might be wrong. I am told that it is the ordinary form. I have no reason to doubt that. The Lords Amendment refers to the number of the Bill as first printed by the Lords. That is not exactly the reference form in which it comes back to us.
I do not find any abnormality of substance at all. If somebody would show me one of substance, I am responsible in my duties to protect minorities. But it must be one not of nonsense but one of substance.

Mr. McInnes: We are considering Lords Amendments, but I find myself with two Bills—Bill No. (29) and Bill No. (45).

Mr. Speaker: I do not think that that is right. The hon. Member can lay aside Bill No. (45). That is only another place's Bill. Ours is Bill No. (29).

Mr. Ross: Further to that point of order, Mr. Speaker. You have said that the House of Lords dealt with the Bill as first printed for that House. I suggest that the Bill as printed for the House of Lords was Bill No. (29) on 2nd March and brought from the House of Commons on 2nd February.
On page 8 of that Bill, line 17 refers to a previous subsection as printed for the House of Lords and which it amended on 12th March. It does not contain any reference to paragraphs (a) or (b). There is subsection (1) which is one very long

sentence. No Amendment was made, but an Amendment was passed referring to a paragraph (a) which was not there.

Mr. Speaker: I think—I do not know —subject to my opportunities of looking at this, that the (b) arises from a printing correction inserted in the ordinary way by the Officers of another place within their discretion. It is part of the process of legislative tidying up, as it were. If it alters the sense, distorts anything, or in some other way abuses the manner in which the hon. Gentleman or any other hon. Gentleman wishes to apply his legislative mind, then I am always his humble servant. But if this is mere (a) and (b) in printing trickery, he does not have my sympathy or help. It is that that I want to know. If there is some matter of substance, I should like to be told about it.

Mr. Ross: Surely it is unfair to call this "trickery", Mr. Speaker. [HON. MEMBERS: "Oh."] With all due respect, I heard the word "trickery". What we are presented with are Lords Amendments. When we, as humble Members of Parliament, ask at the Vote Office for the Bill, we read an Amendment to which we are asked to agree, and we read a reference to paragraph (b) of the foregoing subsection. We take the Bill as presented to us by the Vote Office, and we discover that there is no paragraph (b). Surely if we raise the matter and ask questions about it, it does not merit a reference to Parliamentary trickery. If there is trickery here, it is certainly not on this side.

Mr. Speaker: I was not aware that I had said "trickery". However, one can say the most extraordinary things. I shall confirm this by reference to HANSARD. I should be astonished to find out that I had used that word.
The point is that if it is some printing technique or formulation which is in question I do not feel obliged to protect the hon. Gentleman or others who raise protests about it, because I do not think that there is substance in it. If there is some point of substance, if it destroys in some way the legislative effect or something of that kind, I should like honestly to be told in what respect it does so. That is the point that I have not got.

Mr. Woodburn: There is a point of substance that I wish to put to you,


Mr. Speaker. If the House passes the Amendment, at some time after it has passed it there will be some redrafting of the Bill to make it harmonise with the Lords Amendments and to introduce (a) and (b) to make the Bill read sense. I agree that that is a necessary thing to do. The point that I am putting to you—I think it is a very important point—is: who is responsible for reporting to this House that the Bill has not been altered in its substance or in its sense by that redrafting, and how does the Bill come back to us to show that it is the Bill that we passed and that in the redrafting the substance or sense has not in some way been altered? I cannot myself say. Is it you, Sir, as Speaker, who is responsible for seeing that the drafting is done in such a way that it is in accordance with the will of the House?

Mr. Speaker: There is a responsibility upon the Clerk of the Parliaments, who is the Officer, among others of us, to see that that technical operation is right. Supposing it were technically wrongly performed, or that he was in doubt about it, there would no doubt be a reference back to myself or to the Lord Chancellor or whoever would be the appropriate Officer in another place to see that the technics had not been muddled before we invited the Royal Assent to be ultimate legislation.
However, nothing here is involved, as far as I at present understand, but the mere technics of getting the Bill in order according to what the two Houses have decided in the sense at the moment of whether we are prepared to accept an Amendment which the Lords have offered to us.
If that is all that is involved I do not feel pressed by my duty to protect the Opposition or any minority about the matter, because it is merely a mechanical service rendered by the Officers of the House, by the Clerk of the Parliaments, to get the matter right. If there is some point of substance, if it alters the legislative effect of something, if there is something involved of that kind, I should like to know about it, because it would greatly affect my mind; but nobody has yet told me.

9.45 p.m.

Mr. T. Fraser: I think you have assumed, Mr. Speaker, that someone has informed the House that if this Amendment is made, subsection (1) will be divided into paragraphs (a) and (b). But we have not had such an assurance from any quarter. No one has told us that if we now agree to the Amendment the Officers of the House will make such alterations as are necessary to produce a paragraph (b) to which the Amendment refers.
I think that you will agree that before we accept an Amendment which refers to
paragraph (b) of the foregoing subsection
we should at least have an assurance that if we accept the Amendment the foregoing subsection will be altered to include a paragraph (a) and a paragraph (b). If the Secretary of State for Scotland cannot give such an assurance, I wonder, Mr. Speaker, whether you could give an assurance that subsection (1) will be altered to provide for the necessary paragraphs.

Mr. Speaker: This does not seem to be frightfully difficult. I am sorry to have to treat this matter in such confusion, but, as hon. Members will have seen, I did not have notice of it and returned to the Chair in the midst. I have here a Bill, Flood Prevention (Scotland), which was ordered to be printed on 14th March, 1961. I find on page 8, in Clause 12 subsections (1, a) and (1, b). In those circumstances I do not for the moment understand why hon. Members object to the appropriate reference to paragraph (b).

Mr. Maclay: I think, Mr. Speaker, that the explanation that you gave of how the procedure works between the two Houses has put with absolute clarity what I tried to put before in general terms, but I have not your knowledge of the procedural side.
One point which may have confused you, Sir, was a remark that the Government had had this before them for several months and they could have tidied it up. The point which I ask should be made clear is that no matter when this matter had arisen, the procedure having been followed in the House of Lords which has been followed, and the decision of the appropriate authorities in the House to proceed in


that manner having been taken, there could have been no possibility of doing anything but bringing it to the House in its present form.
The position is straightforward. If hon. Members object to the substance of the Amendment, all that they have to do is to vote against it. If that is not the case, I would have thought that it was clear that the procedure which you have clearly described will take care of all the points which have been raised, and in particular the point raised by the right hon. Member for Clackmannan and East Stirlingshire (Mr. Woodburn), and that the subsection will be tidied up in the way he desires.

Mr. McInnes: Reverting to the point with which you dealt a short time ago, Mr. Speaker, you quoted from Bill (45). That was the Bill which you asked me to discard for the purpose of this debate. You will observe that the proposed Amendment will not fit into Bill No. 45. It seeks to insert certain words at the end of line 17, and that would mean inserting those words in the middle of the word "improvement". One cannot split a word to incorporate something and leave oneself with the other half of the word at the end of the paragraph, if you are following me, Sir—

Mr. Speaker: Yes, I understand very well, but another place does not invite us to agree with merely a printed correction That would waste the time of a lot of hon. Gentlemen in either House of Parliament. Really, I would be grateful if someone would tell me whether he is urging that involved in this there is some point of legislative substance. Otherwise, I understand the whole matter, and I am not interested in a point that is not of legislative substance —it would be beyond my duty. If someone would point to something of legislative substance that affects the matter which he desires to urge on me, it would affect my mind greatly.

Mr. T. Fraser: For an hour and a half or more, Mr. Speaker, we have been asking for an assurance that when the Bill leaves us again to go to Her Majesty it will make sense—

Mr. Speaker: I can give the hon. Gentleman that assurance; that is done by the procedural process I have

described. What we want to know is what the House, including the hon. Gentleman, decides about it. For the moment, the substantial matter is: aye or no, does the House wish to agree or disagree with this Lords Amendment? If the House chooses to assert its view about that, then the mechanics of the situation will be dealt with by highly competent people who will make sure that it makes sense, that there is no printing error about it, that it marries up, is paragraphed in the right way and is orderly in the ordinary way, as is always done.

Mr. Fraser: May I assure you, Mr. Speaker, that it is only now that we have been told that the Bill will make sense when it goes to Her Majesty?

Mr. Speaker: I am greatly obliged to the hon. Gentleman. So I am now in a position to put the Question. The Question is, "That this House doth agree with the Lords in the said Amendment."

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Mr. Ross.

Mr. Charles A. Howell: With respect, Mr. Speaker, I understood that you would come back to me.

Mr. Speaker: I did, and I apologise to the hon. Gentleman. Mr. Howell.

Mr. Howell: I do not think that the question of substance is so important to the House, but what is important is that your Ruling on Parliamentary procedure will go down in history, because it is to that Ruling that the House will have to conform in future. I am sure that before giving a Ruling, Mr. Speaker, you yourself would want to be sure that history would not regret your Ruling.
On the question of procedure from the Chair, if an Amendment was offered that did not affect something in a Bill, you would rule it out of order. Bill (94) is on the Order Paper, but anything not on the Order Paper you would rule out of order. If Bill (94) refers to something that does not exist, it is competent for Mr. Speaker to say that this Amendment is ultra vires because it seeks to amend something that is not before the House. You have indicated that Bill (29) is before the House and is on the Order Paper, and it was only when my hon. Friend asked the Under-Secretary where was the paragraph referred to in the


Amendment that he himself indicated that there was a Bill (45). Mr. Deputy-Speaker had not a copy of Bill (45) until I obtained one for him.
Therefore, the Amendment at the bottom of Bill (94), which has been put before the House, applies to something that does not exist in the Bill we are discussing. Surely, it is quite within Mr. Speaker's jurisdiction to rule out of order an Amendment that applies to a Bill, or a Clause in a Bill that does not exist, and which is not before the House.

Mr. Speaker: No, I do not wish to create any astonishing proposition or precedent for the hon. Gentleman or anyone else. The fact is that when two legislative bodies look at one another's legislative enactments and suggest Amendments, and when, in our case by well-known procedural processes, they ultimately arrive at agreement as to what the substance of the text should be, there remains the need to marry up one particular text with another particular text in a form that is legislatively convenient, grammatically perfect and structurally straight. We have always so dealt with it, and I think that other Parliamentary legislatures do it in the same way—by allowing our Officers to organise texts, frame paragraphs and number and arrange documents in order to give effect to legislative decisions which have been arrived at.
There is, as far as I have yet discovered, no departure from that ordinary process, and I hope that the House will now get on to decide the matter of substance. I do not want to occlude or shut out any serious argument any hon. Member wishes to address to me, but hope that if there is a matter of substance we can get on to it.

Mr. Lawson: With respect, Mr. Speaker, is it not a matter of substance that we should come to this House and have presented to us documents that are quite misleading? I refer to documents which, on the basis of the evidence, could not be understood. Unless hon. Members could obtain Bill (45) we could not understand the matter before us. Is that not a matter of substance? Surely it should be of considerable concern to you, Mr. Speaker, to see that hon. Members are properly serviced in matters of this kind?

Mr. Speaker: Is the hon. Gentleman saying to me that he was unable to get a copy of Bill (45) at the Vote Office? If he is, then that is my immediate concern, but I have no information that such was the fact.

Mr. Lawson: It was not available to hon. Members here. It was only because of a slip of the tongue—

Mr. Speaker: Was it available at the Vote Office?

Mr. Lawson: It was, eventually.

Mr. Speaker: In so far as it was available—

Mr. Maclay: Several copies were brought in to me from the Vote Office, Mr. Speaker.

Mr. Speaker: I dare say that there may have been some lateness. If so—and I will inquire into it—I will try to find out why that occurred. As I have said, I accept personal responsibility for any—

Mr. Lawson: Inconvenience and bad service.

Mr. Speaker: Order.

Mr. Ross: On a point of order, Mr. Speaker—

Mr. Speaker: Order. I am sure hon. Members know that I am on my feet. I was saying that I accept personal responsibility for any failure in the service which the Vote Office should render. I am not saying that that occurred. I just do not at this moment know. Having said that, is the position now that some hon. Members feel themselves embarrassed in their legislative activities because they have been unable to get from the Vote Office a copy of the Bill they wanted at this stage? If that is not so, I hope—

Mr. Ross: On a point of order, Mr. Speaker. Surely the Vote Office is not entitled to service hon. Members with anything other than what hon. Members require for the understanding of the actual business—and that is Bill (29). Might I suggest that the reason why there was some lateness and why this difficulty arose was that the document was mentioned by the Under-Secretary and that there is an old rule that if a


document is mentioned that document must be laid upon the Table.

Mr. Speaker: That may well be. I do not know anything about that. If it is said that the Vote Office should have had some document here but it was not here at the time, then I will inquire into it.

Mr. Lawson: Mr. Lawson rose—

Mr. Speaker: Order.

Mr. Ross: Mr. Ross rose—

Mr. Speaker: I am still on my feet. I have said that I will inquire into the matter and that I accept responsibility for the Vote Office making documents available. I will inquire into what happened. But I cannot know that now. I want to be sure that no hon. Member is feeling thwarted in his legislative ability because of the lack of some document which he requires in order to reach a personal decision on the question, aye or no, should the House agree with this Amendment of the Lords. If that is the fact, then I should like to know.

Mr. Lawson: Further to that point or order. Since they are my words that you are interpreting, Mr. Speaker, may I point out that I did not say there was a slip-up on the part of the Vote Office? I am here concerned—

It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE

Proceedings on Government Business exempted, at this day's Sitting, from the provisions of Standing Order No. 1 (Sittings of the House). — [Mr. Maclay]

Orders of the Day — FLOOD PREVENTION (SCOTLAND) BILL

Question again proposed, That this House doth agree with the Lords in the said Amendment.

Mr. Lawson: I repeat, Mr. Speaker, since it seems to me that you were interpreting my words and my grievance, that I should make it clear that I said nothing about a grievance with the Vote Office. I said that we were badly serviced in this matter. I am concerned with the fact

that we are asked to deal with a paper which refers to a particular Bill and nothing but this Bill. The Amendment Paper containing the Lords Amendments was before us. It refers to Bill (29). Bill (29) was before us. So far as we knew, there was no Bill (45) in existence. It was only when Bill (45) was mentioned by the Joint Under-Secretary of State that we had any knowledge of it. Only then did we learn that if we were to understand what we were asked to consider we would have to get Bill (45).
There is no fault here with the Vote Office for not making the Bill available to us. All that was mentioned was before us, but what was before us was insufficient to enable us to understand the business that we were called upon to decide. In this sense I think that we are badly serviced, not by the officials of the House but by the members of the Government who ought to have seen that this job was done—

Mr. Speaker: If that is true it would follow that the hon. Gentleman is rising not to a point of order but to something else. The point is that if there is something of substance which affects hon. Members' ability as legislators I am eager to listen and protect. So far as matters go at present—I will check my recollection when I can look at things tomorrow and see what has happened in my absence—I cannot find any departure from the ordinary processes in this matter. I greatly hope, if that is so, that the House will now feel able to direct its attention once again to the Question before it, which is, aye or no, does the House agree with the Lords in the said Amendment to line 17?

Mr. Ross: We are asked to agree to an Amendment to a Bill which left this House, which had been amended in a Committee and on Report, which had been printed no fewer than three times and which, when considered in another place, appeared as Bill (29). I do not know how the Amendment was made in another place, but if they amended Bill (29) then someone in another place failed to try to relate it to the Bill that was Bill (29) as printed because there was no paragraph (b). The Bill was brought forward from the House of Commons for consideration in another place on 2nd February. The fact is that we have no knowledge of what they did.
Reference has been made to another Bill, but that other Bill contains the Amendments with which we have either to disagree or agree already printed, presupposing our agreement thereto, but it is unjustifiable to expect us to take any cognisance of it. I am surprised that the Joint Under-Secretary at the start of this business did not decide to disagree with the Lords in the said Amendments, because as related to the Bill as it left this House and as printed —which is the only thing which it is in order for us to discuss—it does not make sense.
If so much latitude was given to the printers to omit this and to omit that, I do not see why they did not exercise their latitude in reverse and omit the words "paragraph (b) of", in which case there would have been no trouble at all. But the Joint Under-Secretary of State and the Lord Advocate—I am glad to see that the right hon. and learned Gentleman is still with us in presence, if not in spirit—will know quite well that we do not leave out things and put things in and blame the printers. I do not know whose bright idea it was. I do not believe that any such thing has happened before. I am sure that it has not. It is a reference in an Amendment which, when applied to the only Bill which is really in order, just does not make sense.
What we have to take for granted is that, somehow or other, after we have passed it, some printer will reprint the thing and make sense of it. That depends on which printer does it. [Interruption.] I am glad that the hon. Member was not speaking to me. He would have got a reply if he spoke to me in the way that he speaks to his hon. Friends.
We have a different interpretation of punctuation depending upon whether the printing is to be done by order of the Officers of this House or by order of the Officers of another place. We have no guarantee that, if we incorporate this Amendment as here printed in the Bill as we passed it, which is the only thing which is relevant, in my view, someone will assume the right to change the subsection and break it into paragraphs (a) and (b). This is the first time in my Parliamentary experience that I

have learned that to break a subsection into two paragraphs (a) and (b) is regarded simply as a matter of punctuation.
What happened here was that someone forgot to move an Amendment in another place. The hand of Craigton is written all over it. It is the muddle of the Minister of State. He may have gone to another place, but the memory lingers on. Someone forgot in another place to move an Amendment breaking the subsection into paragraphs (a) and (b). The Bill as printed and considered by the Lords did not permit of such an Amendment being made because at that time the printers had not used the latitude of which we have learned tonight. It would have been a matter of anticipating the latitude of the printers even as we are expected tonight to anticipate the latitude of the printers.
It has been suggested—you have yourself suggested it, Mr. Speaker—that there is no real matter of substance here. For my part, I just do not know. I am asked to refer to Bill (29). When I refer to Bill (29) I find a subsection (1) on the appropriate page but no reference to paragraph (b). Have I to assume that the printers have done something, or have I to assume that there is a new paragraph (b) somewhere which may be a paragraph (b) of substance? To suggest that we have no right to raise this kind of point is going a bit far. For anyone to suggest that we have been indulging in Parliamentary trickery or anything else is—

Mr. Speaker: I am sure that my sentiments for the hon. Member would cause me to think that I am wrong in my deduction that at some stage he thought I had said "trickery". I do not know whether I did or not. I did not mean to. I will see in due course. But the result of the hon. Member's words is to make his speech to the Question, "That this House doth agree with the Lords in the said Amendment", sound at this point as though it were critical of some procedure of the Chair. If that is not so, I shall not interrupt him, but I am compelled to do so if, in fact, it is.

Mr. Ross: Surely, if you did not say that, Mr. Speaker, for me to suggest that


anyone could call it Parliamentary trickery could not possibly be a reflection upon you, unless, of course, as the learned Lord Advocate, with his customary profundity, says, "if the cap fits." I think that is a very improper suggestion for him to make, because it is an interpretation of your subjective mind at present.
I repeat that for us to have raised it and to have dealt with this matter as we have dealt with it, in view of the unsatisfactory answers we have had from the other side of the House, does not entitle anyone to say that we have been indulging in parliamentary trickery. We have dealt with what is before us, and what is before us in certainly a legislative puzzle.

Mr. John Diamond: It is nonsense.

Mr. Ross: If we accept the advice of the Government, it will be legislative nonsense, unless a printer is to break up and has the right to break up that paragraph into sub-paragraphs (a) and (b). I hope that the Joint Under-Secretary will give us another explanation and tell us what he thinks is to happen, or say whether it would not be better not to accept the Lords Amendment.

Dame Irene Ward: Do not.

Mr. Willis: The hon. Lady is not in the House.

Dame Irene Ward: It does not matter; I am just as good as a Scotsman.

Mr. Speaker: Order. Interruptions are from all points to be deplored, but from outside the House they are wholly disorderly.

Mr. Ross: As far as I understand, we were being invited to divide the House on the Amendment, but it would be far better for the Government to accept the inevitable dangers of it, and for themselves and in their own interests, to deal with the other Amendments and then deal with this matter with another place. It is a simple matter, and it could be simply done, and if I can, in all innocence in regard to the precedents, offer a suggestion, I think that would probably be the best thing to do. Indeed, I thought they would have taken

this attitude a long time ago. I think that precedent is something which in this respect we have to be very careful about.
The only way in which we could get out of the difficulty into which the Government have got themselves would be to disagree with the Lords in this Amendment. What follows therefrom is a coming together in respect of this Amendment so that the matter would then be sorted out. It is not a case of losing the Bill, or the rest of the Amendments. It is a case of leaving unresolved this question of paragraph (b) of subsection (1) which is referred to in the new subsection (2).
I would have thought myself that, from the point of view of Parliament, it would have been better for the Government to take that course, but if they take another course I hope that their assurances can be relied upon—that a printer, after all the storm raised tonight, is to take it upon himself to reprint the Bill as passed by this House and to break up that paragraph into two sub-paragraphs, and then the Government tell us that it is purely and simply a matter of punctuation. Unless they do that, and we have no guarantee that it will be done, what we are being asked to agree to makes absolute nonsense.

10.15 p.m.

Mr. Manuel: We are dealing with a matter of great importance. We devoted many hours to tabling Amendments and going into the Bill very thoroughly. I am sure that you, Mr. Deputy-Speaker, would agree, because you were in the Chair at the beginning of this argument, that it has been most difficult for hon. Members properly to understand what this Amendment with which we are concerned attempts to do, because it is tied to a "foregoing subsection", but there is no "foregoing subsection" in the Bill.
The Joint Under-Secretary of State mentioned Bill No. (45). That has been amended by another place, but it is not before us. I immediately went to the Vote Office and asked for a copy, but one was not available.

Mr. Dudley Williams: Here is one.

Mr. Manuel: At that time one was not available. Another hon. Member who was sitting on a seat below the Gangway also went to the Vote Office. The Secretary of State hurriedly secured a few copies which he handed to our Front Bench, thus recognising that copies of the Bill were not available in the Vote Office. Some time later they became available in the Vote Office and we were able to obtain them.

Mr. John Brewis: I obtained copies from the Vote Office.

Mr.Manuel: The hon. Gentleman must have immediately followed me into the Vote Office. If he is trying to bolster up the flimsy argument put forward by his own Front Bench. I cannot commend him for that.

Mr. Charles A. Howell: I think that that intervention was ill-advised. There is no criticism of the Vote Office. The Officers of this House have to place on the Table, both for the Government Front Bench and for the Opposition Front Bench, the papers which are necessary for the day's work laid down in the Order Paper. The Amendments with which we are concerned refer to Bill (29). Therefore, the Officers of the House place on the Table copies of that Bill.
The Joint Under-Secretary of State said, "If you want to know what I am talking about and what this Amendment means you will have to look at Bill (45)", and it was only when I obtained a copy of Bill No. 45 from the Vote Office that the Chair had a copy of the Bill. Mr. Speaker should always be provided with all the documents necessary for the whole of a day's work. He was not provided with a copy of Bill (45). I challenge the Government Front Bench to say whether there was anyone in the House other than themselves who had a copy of Bill (45).

Mr. Manuel: I am obliged to my hon. Friend for fortifying my argument with irrefutable facts. The point that I was making was that it is difficult for hon. Members to grasp what we are trying to do because we are only looking at Bill (29). I still cannot understand how Mem-

bers of another place can table Amendments to a non-existent foregoing subsection. No hon. Member here would be allowed to do that. Mr. Speaker said to me that the Members of another place had no greater privileges in this matter than we have here. But that is hard to understand. It is happening before our eyes tonight. Like my hon. Friend the Member for Kilmarnock (Mr. Ross), I am concerned that once we depart with the Bill, having dealt with the Lords Amendments, there will be no further opportunity for us to consider the matter. The Bill will go forward for the Royal Assent and it will become the law of the land. We have no guarantee that the corrections that are made will be those made according to our understanding of the position in connection with Bill No. 29.
The Joint Under-Secretary could quickly resolve the difficulty. It would not delay us more than a day or two. He has told the House that this is the right procedure and that the technical point which is involved can be cleared up. Can he tell me of any occasion when there have been similar circumstances when the House has been asked to accept "in the dark" something that will be cleared up by clerical corrections after we have parted with the Bill? I have never met the set of circumstances which confronts the Scottish Members tonight.
We are concerned about the Bill and its purpose. It is linked to great projects in my constituency and I am naturally concerned that it should operate correctly once it becomes law. I am sorry that the Secretary of State, who is interested in this Measure, is putting it through its final stages in the way which he has indicated to us.

Question put and agreed to. [special Entry.]

Clause 15.—(INTERPRETATION.)

Lords Amendment: In page 9, line 44, at end insert:
'statutory undertakers' and 'statutory undertaking' have the same meanings as in the Town and Country Planning (Scotland) Act,1947".

Mr. Galbraith: I beg to move, That this House doth agree with the Lords in the said Amendment.
The Amendment defines the statutory bodies covered by the earlier Amendment to Clause 3 and it follows the pattern of existing legislation.

Mr. Ross: I wondered whether the Joint Under-Secretary would take up a point raised on an earlier Lords Amendment, when my hon. Friend the Member for Edinburgh, East (Mr. Willis) spoke about statutory undertakers and mentioned the Coal Board. Am I not right in thinking that although transport, electricity authorities and the gas boards are covered by this definition, it does not cover the Coal Board?
The definition from Section 113 of the 1947 Act, which the Amendment specifies, is as follows:
'statutory undertakers' means persons authorised by any enactment to carry on any railway, light railway, tramway, road transport, water transport, canal, inland navigation, dock, harbour, pier or lighthouse, undertaking, or any undertaking for the supply of electricity, gas, hydraulic power or water …
So the privilege of insisting upon consent in relation to the authorities is not extended to the Coal Board. In putting forward this definition, was it the Government's intention to have it that way? When discussing the earlier Amendment to which the definition relates, the Joint Under-Secretary said that it was an extremely important matter for these people. If it is important for British Railways, it is equally important for the Coal Board and its properties and interests. If it is important for the electricity authorities, why has the Coal Board been left out? Possibly, there is a reason for this. I ask the Joint Under-Secretary or the Secretary of State whether it was deliberate or was merely another oversight. May I appeal to them to get the printers to put the Coal Board in?

Mr. Galbraith: With the leave of the House, I hope that I can deal with the difficulty that is worrying the hon. Member for Kilmarnock (Mr. Ross). It is really very simple. The Coal Board did not ask to be included, whereas other statutory undertakings did.

Mr. Ross: Am I to understand that all these statutory undertakings, dock, harbour pier and lighthouse under-

takings, asked to be included? Although it was said in another place that representations had been made, no information was given either in another place or here tonight about who actually asked. Although we have had references to public authorities, this is the first time in the Bill that we have had a reference to statutory undertakers.

Mr. Deputy-Speaker (Sir Gordon Touche): The hon. Member needs the leave of the House to speak again.

Mr. Ross: By leave of the House, I should like to ask whether the Coal Board was made aware that it might well be as concerned as the others.

Mr. Willis: My hon. Friend the Member for Kilmarnock (Mr. Ross) asked a question which, I thought, deserved an answer. I raised this matter on the first Amendment tonight and asked whether the Coal Board would be included. I said on that occasion that I could understand that there might be reasons for the Coal Board wanting to know what was being done about the maintenance and repair of drainage systems, because it might possibly affect the mines in a certain area and might result in flooding. That seems to me perfectly logical. If we interfere with watercourses in an area where there are mines, we might well cause an extra amount of water to go into those mines. Therefore, I should have thought that there was good reason for the Coal Board being included, and a much more important reason than the reason for the inclusion of a lighthouse authority.
I cannot see why lighthouses want to be in and the Coal Board out, or a harbour authority in and the Coal Board out. This, once again, is an example of the most slipshod kind of thought on the Government's part. They have allowed things to be done here to which they have given little thought, with the result that we now have the fantastic situation in which a local authority must consult a lighthouse authority but not the Coal Board. The Joint Under-Secretary ought to have given us a much better explanation than he has given of why this interpretation should be the right one and why it would not have been better to have enumerated the bodies with whom there should be consultation and whose permission is probably desirable.

Mr. Galbraith: I do not know whether I have the leave of the House to speak for a third time. The Coal Board did not ask at any time to be specially consulted, but various other statutory bodies did, though not all of them. The hon. Member for Kilmarnock (Mr. Ross) is perfectly right. We thought that the definition of a statutory undertaking covered the bodies which had asked to be consulted and we adopted that in the Bill out of convenience.

Mr. Manuel: I am sorry that the Government, in their siftings of this matter, did not take the opportunity to ask the Coal Board whether or not it would like to be included in connection with its Scottish undertakings. As my hon. Friend the Member for Edinburgh, East (Mr. Willis) indicated, where there is extensive flooding, or where operations are taking place to rid certain areas of flood water, that flood water must be disposed of somewhere else. Either one channels it off or one drains it in some fashion from where it is causing surface difficulty.
10.30 p.m.
I would have thought that the Coal Board would have been very much concerned. If there were drainage excavations or any operations at all near its workings, it would naturally want to know that it had safeguards against the infiltration of water into its workings whether they were being actively operated or whether they were not being actively operated but might be actively operated at another date. It would be much more pertinent to the purposes of the Bill to have the National Coal Board as one of the statutory undertakers specified than some of the others referred to.
I would ask the Under-Secretary of State, by leave of the House, to say whether he agrees that the Coal Board should be consulted. I cannot imagine that in Ayr County it would not be consulted. It might be as well, therefore, that the Lords Amendment should refer to the Coal Board.

Mr. T. Fraser: I wonder whether the Secretary of State would admit at that Box that a mistake has been made?

Mr. Willis: Yes. This is slipshod.

Mr. Fraser: Did the right hon. Gentleman know—

Mr. Maclay: I will say at this Box that when a mistake is made and I know it has been made I will get up and say so. No mistake has been made. That was a short, concise speech.

Mr. Fraser: That courteous intervention in my speech—

Mr. Maclay: Perhaps the hon. Member—

Mr. Fraser: No. I will not.

Mr. Maclay: All right.

Mr. Fraser: I got that very courteous intervention in my speech before I got half a sentence out. You showed a great deal of the incompetence during the whole evening—

The Lord Advocate (Mr. William Grant): On a point of order. Mr. Deputy-Speaker I would call your attention to the fact that the hon. Member for Hamilton (Mr. T. Fraser), with his usual courtesy, of which he is so proud, said "You have shown incompetence." He used the word "you". I put that to you as a point of order.

Mr. Deputy-Speaker: If the hon. Member referred to the Chair he was grossly out of order.

Mr. Fraser: I did not refer to the Chair at all.

Mr. Maclay: The hon. Member did not, but he should.

Mr. Fraser: I cannot understand the occupants of the Government Front Bench. The incompetence which they have shown has been obvious in our proceedings since 8 o'clock, two and a half hours ago. It is clearly obvious that the second of the Lords Amendments we considered and which referred to statutory undertakers and statutory undertakings referred to bodies like the National Coal Board. They were obviously included in the provision. I cannot believe that the Secretary of State consciously, deliberately decided


that, in making a flood prevention scheme, account should be taken of the views of the lighthouse authorities but that no account should be taken of the views of the Coal Board.
Incidentally, in its mining operations the Coal Board may well be much concerned with a flood prevention scheme. The right hon. Gentleman will remember the incident at Knockshinnoch Colliery, in Ayrshire, a few years ago, when some miners lost their lives as a result of an inrush of water which was lying in a part of the country which might well have been drained by a proper scheme. I cannot believe that after that incident, in which many lives were lost, the Secretary of State takes the view that the Coal Board ought not to be interested in the making of a flood prevention scheme.
In the Second Schedule, relating to the confirmation and coming into operation and validity of flood prevention schemes, there is a reference to statutory bodies, and "statutory body" is then defined as
any body exercising functions conferred on it by or under any enactment.
If another place had used not the phrase "statutory undertaking", but "statutory body", would not everyone have been covered? Would not protection have been given to all concerned?
It is clear that in this as in other matters Her Majesty's Government, having got the words "statutory undertaking" and having been given the excellent legal advice which is always available to them, decided that they would interpret "statutory undertaking" and "statutory undertaker"—making an Amendment to that effect—as in the Town and Country Planning Act, 1947, where the words are interpreted, not then realising that that interpretation was hopelessly inadequate for this Bill. I cannot understand why a Minister does not sometimes get up and simply say, "I am sorry. I have made a mistake".

Question put and agreed to.

Lords Amendment: In page 10, line 18, at end insert:
(6) For the purposes of this Act the service of any notice, scheme or other document on any person, body or association may (without prejudice to any other method of service) be effected by sending it to him, or, in the case of

a body or association, to the secretary or other similar officer thereof, by post at his usual or last known residence, place of business or office.

Mr. Galbraith: I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment, which rectifies an earlier drafting Amendment and is in common form, is necessary for the protection of local authorities so that they will not be unnecessarily hampered in operating the Bill.

Mr. Ross: I am interested in the hon. Member's phraseology. His brief probably says that the Amendment is to correct an error. This Amendment was to correct a mistake of omission and there is nothing drafting about it. The Government forgot to put this into the Bill and they remembered when the Bill was in another place, and it is in now. That is true, is it not? It is only a minute ago that we had the pride of the Scottish Unionist Party, the Secretary of State, saying, "If a mistake is made, I will rise at the Box and say so." He has not done it tonight. He had an opportunity to carry out that promise within a minute of its being made, but instead we have had this phraseology from the Under-Secretary about a drafting omission. It is a plain error and nothing else. It is something which had been forgotten.
Naturally, we, too, must apologise, because we should have noticed it. It is about the only thing we did not notice. I remind the House that it was impressed on us that the Bill was urgent and that it bad to be got through quickly. We have other things to do and we cannot correct all the Government's legislative errors.

Mr. Willis: My hon. Friend has forgotten that the Secretary of State has an immense legal department and a vast Civil Service to do all his research for him, while we have to do our own.

Mr. Ross: It is simply because we do our own that we do it so well. I respect the Civil Service, but I am worried about the legal department. In fact, we did a commendably speedy job with the Bill and it might have been better if we had spent a little more time on it. Tonight, we have had more or less to recapture


the meaning of the Bill, It was six months ago that it left the Scottish Standing Committee. Indeed, it is five months since another place dealt with it. Had the Government, who pleaded that they wanted the Bill urgently, given us an extra two sittings we should have found this mistake and put it right. We might even have found the missing paragraphs (a) and (b) for them when they

would have been saved the disgraceful incompetence of tonight's performance by the powers that be in Scotland.
We are grateful to be able to help the Government and to assist them in putting right this "drafting omission." I gather that this is one of the drafting omissions which the printer himself could not have put right.

Question put and agreed to.

Orders of the Day — SHERIFFS' PENSIONS (SCOTLAND) BILL

Lords Amendments considered.

Clause 6.—(RETIRING AGE.)

Lords Amendment: In page 3, line 35, leave out "appointed" and insert:
first appointed to the office of sheriff".

10.41 p.m.

The Lord Advocate (Mr. William Grant): I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment arises out of one made on Report in this House, in order again to meet certain points made in Committee upstairs by the hon. Member for Edinburgh, East (Mr. Willis) and, I believe, by the hon. Member for Glasgow, Central (Mr. McInnes). It was to bring in an age limit of 72 for any sheriff or sheriff principal appointed after the date when the Bill became an Act.
In the Amendment as drafted, and I take full responsibility for this—the hon. Member for Kilmarnock (Mr. Ross) can say what he likes about my competence in regard to this—there was, unfortunately, a technical snag, because it sometimes happens that a sheriff in one of the more outlying and lesser paid sheriffdoms is moved to a better paid office. That is a new appointment and not a transfer.
The effect of this Amendment would be that when that happened to a sheriff in office at present, if he were transferred and was newly appointed to another sheriffdom, he would not be caught by the retiring age under the Bill. I do not think that on Report it was the intention of any hon. Member that that should be so.

Mr. Thomas Fraser: I am not sure that I agree with the Lords in this Amendment at all. Originally the Bill proposed among other things to fix an age at which sheriffs would be obliged to retire. There is an upper age limit and there is provision for a sheriff to retire at any time from the age of 65 onwards. We started by saying that the upper age at which a sheriff would be obliged to retire was the completion of the year in which he reached 72 years of age. Then we provided in

respect of the part-time sheriffs, that is to say, the sheriffs principal, that only those appointed after the coming into operation of this Measure would be required to observe the retiring age limit of 72 years.
The Amendment now proposes that the Bill should be further altered to provide that this requirement to retire at 72 years of age shall apply only in respect of those sheriffs who were first appointed to a sheriffdom before the passing of the Act. Therefore, we could well find that ten years from now a sheriffdom would still be landed with a new sheriff who would be already over the retiring age of 72 years.
10.45 p.m.
This is an absurd situation. I do not agree with the Amendment. If we take the example of the sheriff of Lanarkshire—no, Lanarkshire would be a bad example. If we take the sheriffdom of Ayrshire, we shall have the learned sheriffs substitute, the full-time sheriffs who are disabled from engaging in private practice, required to retire at 72. But if we accept this Amendment, a sheriff who is already in office in another sheriffdom and is transferred to the sheriffdom of Ayrshire in the year 1971, when he is already 73 years of age, he may be landed on the sheriffdom of Ayrshire under this Amendment, but only under this Amendment; because if we do not agree with this Amendment he would be required to retire at 73 years of age. If we agree with this Amendment, the Lord Advocate can take a sheriff from another sheriffdom in Scotland and appoint him as sheriff of Ayrshire when the sheriff is already beyond the retiring age.
Why does the right hon. and learned Gentleman want to do this? Is he having second thoughts about the original purpose of the Bill? Has anyone pressed him to do this? Is there any good reason for making this Amendment at all? Is it a good thing for us to legislate in 1961 that the compulsory retiring age for sheriffs should be 72 and then provide a legal loophole by which a sheriff could be transferred from one sheriffdom to another ten years after, at the age of 73 or 74? Why should we agree with this Amendment? What is the case for


it? I hope that the Lord Advocate can see how the same reasoning applies to a tell us the justification for it, which so sheriff who is engaging in private practice, far we have not heard.

Mr. E. G. Willis: I am glad to hear the views expressed by my hon. Friend the Member for Hamilton (Mr. T. Fraser). I have not discussed this matter with him, but I had come to the same conclusion that this is not a desirable Amendment. My hon. Friend put the case against the Amendment on the basis of a sheriff being transferred from one sheriffdom to another at the age of 71, for example, when he would be able to continue in office until he was 80 or 85. That could hardly be expected to induce in the minds of people who might have to appear before him any great confidence in the legal system of Scotland, and perhaps not in the justice which might be metered out.
I have always been against the idea that for some strange reason judges do not reach the end of their working life. I have never been able to understand why in other professions men are accustomed to retire at 60 or 65 but that in the legal profession they seem to go on for ever. When we discussed the legislation relating to judges' pensions, and during the passage of this Bill, I moved Amendments to the effect that the retiral age should be made as low as possible. I moved an Amendment which the right hon. and learned Gentleman was kind enough to accept to apply this provision to sheriffs not prevented from engaging in private practice.
I do not see why we need to pass this Amendment. If it is a good thing for a sheriff to retire at the age of 72, and I think that it is good for him to retire earlier, it seems to me that there is no argument for stretching it out and allowing as many people as possible to remain after the age of 72. Why should we go out of our way to make a special exception and allow people to stay on after they are 72 when we have decided that it is a good thing for them to retire at that age? I do not understand that.
I can understand the exceptions in the case of a sheriff or sheriff substitute who was appointed before the Bill is passed, because he has accepted a full-time permanent job on this basis. But I cannot

see how the same reasoning applies to a sheriff who is engaging in private practice.
For these reasons, and the powerful ones advanced by my hon. Friend the Member for Hamilton, I find it exceedingly difficult to understand why this Amendment has been moved. The legal profession takes some beating. If one tries to control it in one way it gets round it another way. Here, members of that profession are clinging on to the plums and the incomes of office for as long as possible. It is all rather sordid. Why do they not get out and make way for younger people? This is a squalid business altogether—a little bit of money grabbing by people who have already enjoyed handsome incomes, in most cases, all their lives. It is greatly to be deplored.
I would like to see the legal profession acting more magnanimously and a sheriff saying, "At the age of 73 I believe that I am fit, but I know that I am not fit to do the job and I will get out." But, no! Sheriffs can be wheeled into court, or cannot hear half the time, or may snooze. One has only to look round the House of Commons during Question Time. I have seen as many as a dozen hon. Members nodding away and then jerking up their heads. If we have a judge doing this sort of thing, what confidence does that create in the mind of the poor litigant who is appearing before him? The litigant naturally thinks that he is not getting a fair trial. He may be—I am not saying that he is not. But he says, "You should have seen the dodderer who tried me. He did not hear half the things I said."
This is not good enough. What we did in Committee was a good thing. I cannot say that I have been convinced so far by the Lord Advocate of the wisdom of accepting this Amendment, which will allow more people to Carry on than probably would have carried go on if the Clause had remained as it was.

The Lord Advocate: I speak again by leave of the House. I always enjoy the speech of the hon. Member for Edinburgh, East (Mr. Willis) about lawyers. I am sure there must be somebody up-stairs who has not heard it before. We are accustomed to it and know it by heart. He was more impressive than usual but that is probably because it is nearly eleven o'clock.
The Bill as originally drafted applied an age limit to sheriffs substitute and full-time sheriffs only if they elected to come under its provisions. That is to say, they could take advantage of the Bill and the age limit or stick out altogether. It was only on Report that we dealt with part-time sheriffs. I confess that, if I had thought of this at the time, I would have drafted the Amendment rather differently. It was not intended to apply to anybody at present in office.
The reason is simply that as a matter of practice and convenience it is desirable on occasion to move an existing sheriff from one of the less busy sheriffdoms to one of the busier ones. I have ascertained that there may be one or two sheriffs who could desirably be promoted, as it were, if Her Majesty were to think fit, but they might think twice about it if they came under the age limit on such a transfer because it is technically a new appointment and, accordingly, it would bring them within the Bill.
The point is not so much foisting an old man on a new sheriffdom, because if he is good enough to be put on a new sheriffdom he is obviously a man of some ability. The argument works the other way, because it means that one rarely leaves an incompetent one to moulder in the same remote spot until he is 80 or 90; what one wants to do is to get a good one to transfer to the busy sheriffdom where he is most wanted.
That is the reason for it. I feel that the hon. Member for Edinburgh, East and the hon. Member for Hamilton (Mr. T. Fraser) are not really as "agin" the Amendment as they indicated when they spoke.

Question put and agreed to.

Orders of the Day — TRUSTS (SCOTLAND) BILL

As amended (in the Standing Committee), considered.

New Clause.—(ACCUMULATIONS OF INCOME.)

(1) The following provisions of this section shall have effect in substitution for the provisions of the Accumulations Act, 1800, and that Act is hereby repealed.

(2) No person may by any will, settlement or other dispositions dispose of any property in such manner that the income thereof shall be wholly or partially accumulated for any longer period than one of the following, that is to say—

(a) the life of the grantor; or
(b) a term of twenty-one years from the death of the grantor; or
(c) the duration of the minority or respective minorities of any person or persons living or in utero at the death of the grantor; or
(d) the duration of the minority or respective minorities of any person or persons who, under the terms of the will, settlement or other disposition directing the accumulation, would for the time being, if of full age, be entitled to the income directed to be accumulated.

(3) In every case where any accumulation is directed otherwise than as aforesaid, the direction shall, save as hereinafter provided, be void, and the income directed to be accumulated shall, so long as the same is directed to be accumulated contrary to this section, go to and be received by the person or persons who would have been entitled thereto if such accumulation had not been directed.

(4) For avoidance of doubt it is hereby declared that, in the case of a settlement or other disposition inter vivos, a direction to accumulate income during a period specified in paragraph (d) of subsection (2) of this section shall not be void, nor shall the accumulation of the income be contrary to this section, solely by reason of the fact that the period begins during the life of the grantor and ends after his death.

(5) The restrictions imposed by this section apply to wills, settlements and other dispositions made on or after the twenty-eighth day of July, eighteen hundred, but, in the case of wills, only where the testator was living and of testamentary capacity after the end of one year from that date.

(6) In this section "minority" in relation to any person means the period beginning with the birth of the person and ending with his attainment of the age of twenty-one years, and "grantor" includes settlor and, in relation to a will, the testator.—[The Lord Advocate.]

Brought up, and read the First time.

10.57 p.m.

The Lord Advocate (Mr. William Grant): I beg to move, That the Clause be read a Second time.
The Clause gives effect to an undertaking which I gave slightly halfheartedly in the Committee stage. It is tied up with a later Amendment to delete Clause 5.
During the Committee stage the then hon. and learned Member for Paisley, Mr. D. Johnston, suggested that the provisions of the Accumulations Act, 1800, should be re-written in the Bill and not merely referred to. That was done in England about 35 years ago. On consideration, I felt that it would be easier for those who have to use this Bill when it becomes an Act that we should write out in modern language what the Accumulations Act, 1800, says and put in in Subsection (4) what really is a simpler and clearer statement than what we have in Clause 5 at present. I shall not now deal with Subsection (4) because we dealt with the substance of it in Committee.

Mr. Thomas Fraser: I am very grateful to the Lord Advocate for bringing forward the new Clause.
I think that I should correct his memory. He said that in Committee the Amendment was moved by Mr. Douglas Johnston, as he then was, the Member of Parliament for Paisley. His memory is at fault. I had the honour of moving it because by that time Mr. Johnston had become Lord Johnston and was a judge of the Court of Session.

The Lord Advocate: The hon. Gentleman is quite right.

Mr. Fraser: Mr. Johnston, as he then was, raised the matter in the debate in relation to the principle of the Bill. I hope that I made clear during the Committee stage that the long Amendment which I moved was not the child of my poor little brain but the child of the brain of the then hon. Member for Paisley which I had merely adopted when its parent was disabled from continuing in membership of this House.
The effect of the Clause, as I understand it, is to incorporate in the Bill the words that were used in the English Act of 1925 and so enable us to get rid once and for all in Scotland of the Accumulations Act, 1800, which was repealed for England some 36 years ago

and which can now be repealed for Scotland by making this Amendment. It will thus be certain that persons in Scotland who become liable for Estate Duty are in an equally favourable position as people similarly placed in England, so that Scottish people might get the same benefits from tax avoidance as English people.
11.0 p.m.
The net effect of the new Clause will be to reduce the amount of money collected by the Chancellor of the Exchequer in Estate Duty and, goodness knows, if we carry this process much further we shall have abolished Estate Duty altogether.

Question put and agreed to.

Clause read a Second time and added to the Bill.

Clause 1.—(JURISDICTION OF COURT IN RELATION TO VARIATION OF TRUST PURPOSES.)

The Lord Advocate: I beg to move, in page 2, line 4, at end insert:
(2) For the purposes of the foregoing subsection a person who is over the age of pupillarity but has not attained the age of twenty-one years (whether acting with the concurrence of a curator, administrator-at-law or other guardian or not) shall lie deemed to be incapable of assenting; but before approving an arrangement under that subsection on behalf of any such person the court shall take such account as it thinks appropriate of his attitude to the arrangement.

Mr. Deputy-Speaker: I think it would be for the convenience of the House to discuss, with this Amendment, the following Amendment in the name of the Lord Advocate.

The Lord Advocate: I think it would be convenient to discuss the following three Amendments together, Mr. Deputy-Speaker.
The point raised in this Amendment is a new one, which I have discussed with a number of members of the legal profession since the Bill went through Committee. It arises from the fact that in Scotland persons under the age of 21 go through two stages; they start in pupillarity—a girl to the age of 12 and a boy to 14—and from then they are in minority until the age of 21.
A minor in Scotland has fairly wide powers. It depends, to some extent, on whether or not he has a curator. He


can enter into contracts, for example, but for four years after reaching the age of 21 he can reduce the contract on the ground that he has suffered some sort of prejudice—what is called lesion—but I think that "prejudice" is the lay phrase that hon. Members will understand.
In the Bill as it stands a court would not be able to give consent to a claim on behalf of a minor, although it could on behalf of a pupil. Because of a minor's right during the four years after reaching the age of 21 to annul a contract, no trustee is going, in practice, to accept a minor's signature on the dotted line. Accordingly, I felt it right —and this is a matter which the Law Reform Committee did not consider, and I have discussed it with one or two of that Committee's members and other bodies and I think that we are all agreed that if this is going to work the court must have power to give consent on behalf of a minor as well as a pupil—that before approving the arrangement a court shall take such account as it thinks appropriate of the minor's attitude. If the minor were a girl aged 20, and married, and if she objected to the arrangement, there is little doubt that a court would reject it on her behalf as well. This is a necessary provision in order to make this workable.

Mr. T. Fraser: The Lord Advocate seems to have made out a case for the Amendment. My only difficulty is that, so far as I can see, a pupil and a minor are not specifically referred to in the foregoing subsection, so that the first Amendment states:
(2) For the purpose of the foregoing subsection a person who is over the age of pupillitary but has not attained the age of twenty-one years (whether acing with the concurrence of a curator, administrator-at-law or other guardian or not) shall be deemed to be incapable of assenting; but before approving an arrangement under that subsection on behalf of any such person the court shall take such account as it thinks appropriate of his attitude to the arrangement.
That seems to be perfectly reasonable, but the point of all this, apparently, is to bring out the differentiation between a pupil and a minor and to provide appropriate protection for a curator or guardian. But the only reference to age in the foregoing subsection is a reference to non-age.

Mr. A. C. Manuel: Unborn?

Mr. Fraser: "Non-age" does not mean unborn. I understand that nonage is under 21. I should have thought that the need for subsection (2) would not have arisen inasmuch as the whole of the foregoing subsection deals with the person of non-age. However, I am in a little difficulty about it. I appreciate that I may not have listened sufficiently keenly to the learned Lord Advocate. He seemed to be making a case for the Amendment, but I think what he said gave the impression that the foregoing subsection dealt with pupils and minors whereas it does not deal with pupils and minors at all.

The Lord Advocate: The hon. Gentleman is quite right. Non-age includes both minors and pupils. But in lines 9 and 10 we refer to
… any of the beneficiaries who by reason of non-age or other incapacity is incapable of assenting …
A pupil is by reason of his age incapable of assenting, but normally a minor, although he is under 21, is not incapable of assenting merely because of his age. I hope I have made this rather complicated matter clear. That is why we refer back. In fact, under the Bill as it stands, a minor would not come under Clause 1 (1, a) except in very special circumstances.

Amendment agreed to.

Further Amendments made: In page 2, line 4, at end insert:
(3) Where the court has approved an arrangement on behalf of any person under subsection (1) of this section, or that subsection as extended by the last foregoing subsection, the arrangement shall not be reducible by that person on grounds of minority and lesion.

In line 5, leave out "the foregoing subsection" and insert:
subsection (1) of this section.

In line 25, leave out "the foregoing subsection" and insert:
subsection (1) of this section or that subsection as extended by subsection (2) of this section."—[The Lord Advocate.]

The Lord Advocate: I beg to move, in page 2, to leave out line 36.

Mr. Deputy-Speaker: This and the next Amendment in Clause 2, page 3, go with the Amendment in Clause 6, page 4, line 1.

The Lord Advocate: These Amendments are drafted to comply with an undertaking which I gave in Committee to the hon. Members for Hamilton (Mr. T. Fraser) and for Edinburgh, East (Mr. Willis) when I withdrew a rather ham-handed Amendment which I had on the Order Paper. I said that I would think again, and this is the result which I think makes the position rather better than it was.

Mr. T. Fraser: May I say how obliged I am to the Lord Advocate for putting these Amendments on the Order Paper. We had an animated discussion in Standing Committee on the question of construing this Measure with the Act of 1921. I know that my hon. Friend the Member for Edinburgh, East (Mr. Willis) joins with me in thanking the Lord Advocate.

Amendment agreed to.

Clause 2.—(VALIDITY OF CERTAIN TRANSACTIONS BY TRUSTEES.)

Amendment made: In page 3, leave out line 11.—[The Lord Advocate.]

Clause 4.—(POWER OF TRUSTEES TO ACQUIRE INTERESTS IN RESIDENTIAL ACCOMMODATION FOR USE OF BENEFICIARIES.)

The Lord Advocate: I beg to move, in page 3, line 25, to leave out from "required" to the end of line 28 and to insert:
to enable the trustees to provide a suitable residence for occupation by any of the beneficiaries".
This Amendment has been suggested by various members of the legal profession in Scotland who will have to work the Measure. Their objection to the words as they stand was that they thought they were ambiguous. I do not go the whole way with them. I think the words are quite clear. However, they said it would be of much greater use to trustees and beneficiaries if the power given were slightly widened. As the Bill stands, they can only use this power of providing accommodation if a testator has, in fact, left the use of the house to a particular beneficiary. This gives them a wider power inasmuch as, even if it is not specifically mentioned, they can provide accommodation, let us say, for the widow, a sister, a niece who might have been helping the testator, and

so on. It extends the power, although the overriding factor is still there, that it must not be contrary to the general purposes of the trust.

Amendment agreed to.

Further Amendment made: In page 3, line 29, leave out Clause 5.—[The Lord Advocate.]

Clause 6.—(INTERPRETATION.)

Amendment made: In page 4, line 1, leave out subsection (1) and insert:
(1) In this Act, unless the context otherwise requires.—
The Act of 1921" means the Trusts (Scotland) Act, 1921;
the court" means the Court of Session; and
trust" and "trustee" have the same meanings respectively as in the Act of 1921. —[The Lord Advocate.]

11.11 p.m.

The Lord Advocate: I beg to move, That the Bill be now read the Third time.
At this stage, hon. Members will not wish me to go through this rather technical legal Bill. I am grateful to hon. Members for the co-operation which I had in Committee and here. I believe that it will be a Bill of great help to trustees in Scotland, and I commend it to the House.

Question put and agreed to.

Bill accordingly read the Third time and passed.

CREDIT-SALE AGREEMENTS (SCOTLAND) BILL

Not amended (in the Standing Committee), considered; read the Third time and passed.

SCOTTISH GRAND COMMITTEE

Ordered,
That for the remainder of the present Session Standing Order No. 61 (Special procedure for Scottish Estimates) shall have effect as if the word "four" were substituted for the word "six" in line 11 and Standing Order No. 61A (Matters relating exclusively to Scotland) shall have effect as if the word "four" were substituted for the word "two" in line 15.—[Sir H. Harrison.]

PUBLIC HEALTH [MONEY]

Resolution reported,
That, for the purposes of any Act of the present Session to amend the law relating to building byelaws and trade effluents and to make such amendments in the law relating to public health and the functions of local authorities as are commonly made in local Acts, it is expedient to authorise—

A. The payment out of moneys provided by Parliament of:

(1) any expenses incurred by any Minister under the said Act;
(2) any increase attributable to the said Act in the sums so payable under any other Act.

B. The payment into the Exchequer of any sums received by any Minister by virtue of the said Act.

Resolution agreed to.

Orders of the Day — WATER SUPPLIES, THE WREKIN

Motion made, and Question proposed, That this House do now adjourn.—[Sir H. Harrison.]

11.13 p.m.

Mr. William Yates: We come now to the end of the day and we move for a few minutes from Scotland into Shropshire to deal not with flood prevention but with the supply of water to my constituency and the area around about. I always feel sorry for those who do not know the beauties of the Shropshire countryside, whether it be upon Wenlock Edge, on a bend in the River Severn, or in the valleys under the shadow of The Wrekin, or even on the old pit banks of Wrockwardine Wood where people are short of water now. Over those pit banks Sir Gordon Richards first started his riding.
It is also good that, at the end of the day, we should use the time to redress grievances. I am glad that my hon. Friend the Parliamentary Secretary is here. We have discussed this matter before, and I hope very much that he will give us a valuable reply tonight. If not, we shall have to take it up on another occasion. If ever there were a county which is abundant with water, it must be Shropshire. In the northern area there is Ellesmere and all the beautiful lakes where one can sail. In the old days, there was the great area of bog stretching from Newport nearly to the River Tern. It was under the

orders of the Duke of Sutherland that the great engineer Telford reclaimed this land for farming, and, of course, it is some of the most valuable agricultural land in Shropshire today. Water—plenty of it. Take the old Tong Abbey. The duty of the Abbot was to see that the King was adequately supplied with carp, and they were sent to London, making sure that Shropshire fish were known in the City. Water—good gracious, from where does Wolverhampton Corporation draw its water? On the road between Shifnal and Albrighton one sees the Wolverhampton Corporation's water works, drawing off valuable Salop water to pour down the gullets of Wolfunians.
And then we come to the area with which we are dealing tonight. And here may I say how glad I am to see my hon. Friend the Member for Ludlow (Mr. More)—the neighbouring constituency—is here, because he has difficult problems in his own area, which is administered by the same board. One would hardly believe it: short of water in Oakengates. Let us take three pits in Shropshire—the old Stafford, the old Woodhouse, and the modern Granville. What is one of the major mining problems, both past and present? It is water; flooding from water. Yet on the Sunday before last I visited Union Street, Wrockwardine Wood, went up to Oakengates, went into a house and turned on the tap and—no water came out! So one reads in the local newspaper, the Wellington Journal and Shrewsbury News of 1st July, the heading
Water crisis. Tell the Ministry, urges Dawley Committee.
I can tell the Minister right now that if he thinks he is building a new city of 60,000 people in that area he will have to have a good look at the water supply, and, in passing, he had better consult his friend to deal with the roads as well. One also reads:
Go the Ministry",
urges Councillor Bullock of Dawley. I understand that the East Shropshire Water Board intends to visit the Ministry fairly soon.
However, from whatever angle one looks at the problem, one can hardly say that the beautiful county of Shropshire is short of water. The question is how the water is supplied to the houses,


and under whose authority. The authority in Shropshire is now vested in the East Shropshire Water Board, and looking back to when I arrived in The Wrekin in 1955, I remember that I drove down Rushmore Lane and was surprised to see some people drawing water from a brook. This has been customary over the centuries. When the local water supply came to the area on the north side, however, everybody ran the waste into the old brook, and my constituents suffered. It is now completely unusable.
Further north lies the farming area of Great Bolas, and the Severn River Board, mindful of flooding in the area controlled by the Strine Drainage Board, decided to deepen the river Strine where it enters the Tern. Having done this, it meant that many in Crudgington Green had to dig their wells deeper; and the majority had to do this themselves.
By 1957 and 1958 I was getting perturbed about the supply of water to farms in this area. I complained of the slowness of the water board in submitting plans to the Minister of Housing and Local Government and suggested that perhaps they might push on a little. This was greeted with a furore in the local press by the water board. Although one does not mind being abused in public, speeches were made condemning the fact that I was even interested in helping my constituents to obtain a water supply which they so badly needed.
So sensitive was the water board that I thought it would be a good idea to put a Question on the Order Paper to discover how well the board had served the area. In March, 1959, therefore, I asked the Minister:
… whether he has yet given approval for capital expenditure to improve the rural water supplies in the areas of Crudgington, Bolas and Waters Upton.
The reply was:
No scheme for the improvement of water supplies in these areas has been submitted for my Right hon. Friend's approval."—[OFFICIAL REPORT, 7th April, 1959; Vol. 603, c. 2.]
The water board, having been caught out, was absolutely furious. I therefore sent the board's comments to the Minister, who replied as follows in an undated letter of May, 1959:
I have had the Ministry's records examined but I am rather surprised by the councillors' comments.

He was referring to the chairman and vice-chairman of the water board at that date.
I therefore asked to see the Parliamentary Secretary in his room at the House. He told me quite frankly that between 1956 and early 1959 the water board had submitted no plans to him for the improvement of water supplies in that area. It is a pretty sad state of affairs. Immediately I took this action and complained to the Minister the water board suddenly filled the local Press with the news of grand new schemes to cost £11,000 and £12,000. Eventually, I am glad to say, the water board carried out a scheme for £11,000 most successfully in the area of Waters Upton, Great Bolas and Crudgington.
The letters that I receive from the clerk to the water board usually end: "You can however rest assured that there will be no delay by the board." The board may rest but I am not very assured! Early last year I was not surprised when people in the area of Oakengates and Wrockwardine Wood started to write to me to explain that on Sunday mornings and at other times during the week there was no water supply available. Once again I made comments in the local Press on the lack of water in the area and once again my remarks were greeted by the chairman of the water board with such comments as:
M.P.'s comments unfair and disturbing.
We are getting into a pretty sad state of Parliamentary procedure when a Member of Parliament interested in helping his constituents is called unfair for trying to call attention to the lack of water.
If one is not satisfied with these comments one has only to ask the people and they will say that it is fantastic that there are not proper water supplies in the area. I came across a case of scarlet fever for the first time in my constituency. I am not saying that it had anything particularly to do with the lack of water, but it so happened that the case was among houses where there was a lack of water.
Gradually the water board became alarmed and councillors began to make public statements. In the words of Councillor Wright:
The East Shropshire Water Board have almost made their last move. According to a


member of the water board no improvement can be expected for at least eighteen months.
Indeed, in one paper they said they were robbing Peter to pay Paul and playing draughts in a desperate move to get supplies.
I wonder what plans the water board put to the Minister between the years 1956 and 1958. I do not think it put any plans to the Minister at all, if I judge from his reply to me on 3rd July, 1961. I believe that the only scheme put forward to relieve the water supply in Oakengates and Wrockwardine Wood was submitted in 1959. So, rightly, the Town Clerk of Dawley complains that phasing of water supplies is completely lacking in the area. Does the Minister imagine that no houses have been built during this time? Of course, I calculate that about a thousand council houses and private houses have been built.
Every time one looks at the local paper one always finds that the chairman of the water board in the end turns round and blames the Minister, and so for some time now I have really been wondering whether it is in fact fair for the chairman and the planning authority of this Shropshire Water Board to blame the Minister. Let me make one thing quite clear.
My constituents are satisfied and really do admire the work of the paid officials of the East Shropshire Water Board and also to those of the engineers who work with them, but what they do ask is, who is responsible for water policy? Is it the water board itself, the officials and the members of the board? If so, they think that there has been dereliction of duty and there has been nothing short of crisis and a water scandal. It is no use the chairman of the board complaining that the Minister has not been helpful to him, because when I saw his predecessor in 1958 he said that no plans had been submitted to him and he was only too anxious to do as much as he possibly could to help the area.
Therefore, this evening I hope that the Minister will be able to tell us a great deal more of what is going to be done to relieve the situation. He may say many things, but I understand from officials of the water board that no improvement can be expected for at least eighteen months. They have said this themselves.
I think it is quite disgraceful that planning should have got into such a muddle. If in fact the chairman of the water board is to blame, then I think perhaps it really ought to be his duty, and that of those who are responsible for planning, to submit their resignation to the Minister.

11.28 p.m.

Mr. Jasper More: I am very grateful to have the opportunity to say a very few words regarding the Borough of Wenlock in my constituency which is having the same problem as the constituency of my hon. Friend the Member for The Wrekin (Mr. W. Yates). The Borough of Wenlock includes the two communities of Madeley and Broseley on the considerable elevations on either side of the River Severn. I am informed that in Madeley there are frequently periods when there is a total absence of water due, apparently, to inefficient mains. In Broseley on the other side of the river. There are almost daily failures of the supply. That has been going on for the last four or five weeks every day. This has meant water closets unflushed, hands left dirty and eating and drinking utensils left unwashed for considerable periods, resulting, as one of the Broseley doctors has pointed out, in a dangerously insanitary situation for the whole community.
The East Shropshire Water Board recently received a petition from 562 people from Broseley. The root cause may be that many new houses have been built without adequate consultation and the chief sufferers are undoubtedly those in the higher sites. It has been suggested to me that a temporary remedy might be provided by metering resources of water in the lower sites. I understand that the Board has schemes in hand, particularly a booster scheme to help Broseley at a cost of some £8,000, for which, I understand, the Ministry has now given approval. I am not here to cast blame on either the Water Board or the Minister, but only to ask my hon. Friend if the Ministry can help, either with advice about local development, or in expediting any of the outstanding schemes.

11.31 p.m.

The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Sir Keith Joseph): My hon. Friend the Member for The Wrekin


(Mr. W. Yates) and my hon. Friend the Member for Ludlow (Mr. More) have brought out important points and I shall try in the short time left to answer them fully.
My hon. Friend the Member for The Wrekin, in what was a most lyrical and historically nostalgic speech, was a little sensitive about the reaction of the East Shropshire Water Board. I hope that I shall show the true position and unravel the various strands which contribute to the problems of which he spoke. I think that he will agree that, without distinguishing them, he introduced three separate problems.
The first is the continuing problem of supplying rural areas, particularly farms. This is a continuing effort on which all the water boards in the country are engaged, and it cannot be completed overnight with the best will in the world. The East Shropshire Water Board has piped water to 93 per cent. of the population in its district, which is a fair achievement, but I cannot promise that it will be made into 100 per cent. overnight.
My hon. Friend made great play with the lack of any schemes by the Water Board between 1956 and 1958. I have with me—I will not take up time giving them—the details of schemes which were submitted in 1955 and at the very end of 1958. My right hon. Friend is not aware of any failure by the East Shropshire Water Board to put forward schemes to serve the needs of its area during that period of time.

Mr. W. Yates: I have a letter from his predecessor to say that no schemes were submitted to him.

Sir K. Joseph: My hon. Friend chooses the period from 1956, but a tender for about £24,000 was submitted in 1955.
My hon. Friend rightly spoke of schemes for the Broseley area, and I can tell him that schemes have been approved by my right hon. Friend to the value of £25,000. Tenders have been invited and the work should be completed by the end of March next year.
The serious present position, to which my hon. Friend referred indirectly, is that about which I want to take most time. The short fact—and it is a sad fact—is that in his division housing and

water have become seriously out of phase. That has upset the supply to some existing houses, particularly to about 50 houses in the higher levels of Wrockwardine Wood and Holyhead Road in Oakengates. Increased numbers at a new housing development at the Wombridge Common area at a lower level have affected pressure and upset supply to those higher houses, particularly at weekends when so many people are doing their washing.
The new development of the Worn-bridge Common area, which has interfered with the Oakengates supply, had not been expected by the water board, and it had no reason to expect that development. Housing has been allowed on a site which it had thought would not be used for housing. In mid-1959, planning permission was given for a substantial housing development in the Wombridge Common area and only at the very same time was the water board warned, by the members of the board who were also members of the Oaken-gates Urban District Council. This planning consent was 'translated into actual housing with unusual speed and house building has therefore outpaced the provision of adequate water supplies. The people who are suffering are those at the higher levels in the Oakengates area. How did this happen?
There is a system of cross-representation and mutual consultation between all the relevant bodies. Oakengates U.D.C. has three representatives on the East Shropshire Water Board, and it was they who told the water board in mid-1959 that planning permission had been given. My hon. Friend asks why had planning permission been given without due attention to water supply. Of course, the Oakengates U.D.C. was well aware of the difficulties, but it is not the planning authority. Shropshire is the planning authority. It has a very good practice of consulting the urban district councils in whose area housing is to be allowed. It acted properly and punctually in consulting the Oakengates U.D.C.
The Oakengates U.D.C. failed entirely to appreciate that water schemes take longer to plan and execute than the erection of houses. Oakengates is represented on the county council and on the water board, and it must have


known of the water implications. It is perhaps understandable that Oakengates was very keen to secure development. But the fact is that, despite this cross-representation, housing permission was given without the full water implication having been understood.
When all is said and done, it would be wrong of me to deny that my right hon. Friend would expect the county to be aware of the general water situation in its area, so that even though it consulted Oakengates and did not get a full picture from it, it is proper to suggest that the water situation should, in general, have been known to it.
The East Shropshire Water Board itself has not been dilatory. But the new housing, permitted without ensuring that the water implications were taken care of, has at the lower level tapped the supplies of the houses above. As soon as it heard of the new project in mid-1959, the board immediately commissioned a report from its consulting engineers on the best means of catering for new and existing development as a whole. This report was submitted in February, 1960, and made proposals for supplying water to a total of 2,200 houses. A number of separate schemes were involved and these were submitted to the Department as the details were settled. No delay was involved as the water board was simultaneously engaged in obtaining the necessary consents, agreements to the sale of land, etc.
A scheme submitted in October, 1960. and estimated to cost £100,000 provides for service reservoirs at Snedhill and Cockshutt and related mains to serve new low-level development in Oakengates and the adjoining part of Wellington Rural District and for improved distribution in the high-level areas of Oakengates at present suffering from shortages of supply.
Difficulties in acquiring land and an existing main have held up progress, but these have now been resolved. Water will come from boreholes at Hilton Bank and Sheriffhales from which some water is also used at present to supplement the supply to Shifnal. To ensure the supply for the increased development at Oakengates and Wellington it is proposed to put the Shifnal load entirely on the existing borehole at Shifnal, which will be duplicated and

supplemented by an additional borehole to provide for Dawley as well. A scheme estimated to cost £84,000 provides for a direct link between Shifnal and Dawley, so that Madeley will no longer affect the Dawley supply.
These schemes are to be investigated locally by an engineering inspector of my right hon. Friend's Department next week. If this confirms that they are technically satisfactory they will be approved and the board authorised to invite tenders. The schemes are expected to cure the troubles at Oakengates and Dawley, but they will, however, take up to two years to carry out and during this period the difficulties are likely to persist if not to get worse. Our engineers are unable to suggest any temporary palliatives. The Water Board now find themselves in a difficult situation which will only be remedied when their schemes are carried out. Everyone in the area concerned is now alerted and the pace of housing will be kept in phase with water supplies. I fear that as new houses are built the position of those householders on the higher level will get no better and may even get worse until the new scheme is effective.
The wider implications of any new development in Dawley are well understood by my right hon. Friend. He expects these important matters of services to be dealt with by the local planning authorities. They have a procedure for consultation. They have members on the U.D.C., the county authority and the water board. My right hon. Friend does not reckon to have to supervise the local planning of authorities in this work. The East Shropshire Water Board acted as soon as it knew of the need to act. My right hon. Friend is satisfied that the mechanism for consultation is satisfactory, but that it was not properly used on this occasion.
I hope that it can be said that this was a rare and indeed a unique occasion when housing and water needs got out of phase. I very much regret that about 50 householders in my hon. Friend's constituency will suffer for a period of months yet before the remedy is available for them.

Question put and agreed to.

Adjourned accordingly at nineteen minutes to Twelve o'clock.